Corsair Gaming (CRSR) is a Zack Rank #1 (Strong Buy) that has quietly morphed from a pandemic-hangover gaming stock into a turnaround story. Shares have ripped from roughly $5.50 in mid-February to north of $10 just this past week.
Investors are riding an AI-infrastructure narrative, giving the stock a new growth leg. With that, the stock is on verge of a technical breakout, along with earnings estimates moving in the right direction into earnings print.
About the Company
Corsair is best known to gamers for its keyboards, mice, headsets and PC components, but that’s only half the story now.
The Gamer and Creator Peripherals segment covers keyboards, mice, headsets, capture cards, Stream Decks and USB mics (largely under the Elgato brand), while the Gaming Components and Systems segment builds power supplies, cooling solutions, cases, DRAM and prebuilt/custom gaming PCs.
The company also owns Fanatec, the sim-racing gear maker that just signed a licensing deal with Nissan.
The real catalyst for the stock, though, is Corsair’s pivot into AI infrastructure. In May the company launched CORSAIR PRO, a lineup of AI workstations and on-prem servers built on Nvidia’s Grace Blackwell platform, aimed at businesses that want in-house AI compute instead of renting cloud capacity.
The company is valued at $1 billion and has a Forward PE of 14. The stock has Zacks Style Scores of “B” in Value and “A” in Growth.
The Beat That Changed the Story
Back in May, Corsair posted Q1 EPS of $0.27 against a $0.18 estimate, a beat of 50%. While revenue came in essentially in line at $354.5 million, Adjusted EBITDA nearly tripled year-over-year to $35.8 million. Margins jumped to 10.1% from 6.1%, and management pointed to a record first-quarter gross margin of 32.7% as evidence of a genuine shift toward higher-margin products rather than a one-off.
What makes this more than a good quarter is what came next: Corsair reaffirmed full-year guidance of $0.58-$0.74 EPS even after blowing past Q1 numbers. Management stayed conservative, blaming semiconductor and memory tightness that won’t ease until 2027, and that kind of caution after a 50% beat usually sets up future estimates to move higher.
Gamer and Creator Peripherals is the clean growth engine, with management calling it “structural, not cyclical,”. Stream Deck is expanding across product lines and Elgato’s marketplace posting double-digit sequential growth. Gaming Components and Systems is tougher, still working through a non-GPU upgrade cycle, but even there Q1 gross profit rose while revenue fell.
Estimates Head Higher
Analysts have revised EPS estimates higher across the board over the past 60 days.
Full-year consensus has climbed from $0.69 ninety days ago to $0.73 today, while next year’s estimate sits at $0.74. The current quarter has moved from $0.06 to $0.07 over that same stretch.
Roth Capital initiated coverage on July 22 with a Buy and a $15 price target, and B. Riley reiterated its rating the next day while raising its target to $9 from $7.50. Barclays (Overweight, $9) and Wedbush (Outperform, $8) have both lifted targets since May.
Corsair Gaming, Inc. Price, Consensus and EPS Surprise
The Technical Take
The big move back in May gives traders a nice setup when looking at the Fibonacci levels. Drawing from March lows to May highs, we see the 61.8% level around $8 showed significant support. Traders can lean on this level or some of the moving averages levels below:
- 21-day: $9.45
- 50-day: $9.05
- 200-day: $6.95
Looking at the upside, the stock would need to clear the $11.15 level, which would give 161.8% Fibonacci extension targets at $16.
In Summary
Corsair checks the boxes value investors want in a Bull of the Day: a Zacks Rank #1 with estimates moving higher across every timeframe, a stock breaking out technically with room to run toward that $16 extension target, and a fundamental story — the AI-infrastructure pivot layered on top of a genuine margin transformation — that’s just getting picked up by the sell side. With earnings due July 30, this is a name worth having on the radar heading into the print.
— Jeremy Mullin
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Source: Zacks
