Type to search

Wealthpop News

Should Investors Scoop Up Shares of WallStreetBets Stock Corsair Gaming (CRSR)


Meme stocks have gained plenty of attention from retail investors in the past couple of years.  This attention has propelled shares of companies, which become popular on social media networks such as Reddit, to sky-high prices.

One of the stocks that has been picking up steam among the WallStreetBets group, a popular retail investing community on Reddit, is Corsair Gaming Inc. (CRSR). 

Today, I will analyze the fundamentals of CRSR and determine if investors should add shares of this video game stock to their portfolios.

CRSR designs, sells, and distributes gear for gamers and content creators throughout the world. Its products include power supply units (PSUs), cooling solutions, computer cases, DRAM modules, as well as pre-built and custom-built gaming personal computers (PCs).

After skyrocketing last winter, CRSR’s stock has plunged 30% since the beginning of the year.

CRSR’s financials are improving but it is trading at a high valuation

This poor stock performance has been somewhat detached from the company’s improving fundamental expectations. Indeed, CRSR’s net sales are expected to grow by a healthy 13.2% this year to $1.92b but are anticipated to advance slightly lower in 2022, up 7.8% year-on-year to $2.07b.

With the company’s top line accelerating, CSRS became profitable in the middle of the pandemic. The company posted a net income of $103m in 2020 compared to a net loss of $8.39m in the prior year. Nevertheless, expectations are looking bright for CSRS, as the company’s bottom line looks as if it will accelerate this year by 21.4% to $125m and by 15.2% in 2022 to $144m, representing a net margin of 7.01%.

In addition, the balance sheet of CRSR is expected to improve. The company’s net debt declined from $188m in 2020 to $83.8m this year and analysts are expecting a cash position at the end of 2022 of $52.1m, which bodes well for the company’s future growth prospects.

The valuation of the company, however, is stretched compared to its computer hardware peers. It has a very high 2022 P/E ratio of 17.7x and a 2022e EV/EBITDA of 8.89x.

The company lowered its 2021 outlook, but interest from meme stock investors is surging

Last week, CRSR lowered its revenue outlook for 2021 to between $1.83b and $1.93b from the prior guidance of $1.9b to $2.1b, due to logistics and supply chain issues globally. This drop was expressly triggered by the lack of affordable GPUs in the retail channel, which should continue well into 2022. The negative impacts of the pandemic on chipset manufacturers’ supply chains seem far from over and might even heighten by the end of the year, as the holiday season approaches. 

This announcement has brought selling pressure on the stock, creating a downward gap that indicates an acceleration of the share’s bearish momentum.

Despite that, the company is ahead of its growth expectations and continues to see strong momentum from gamers and streams that are buying for the first time or updating their gear faster than in the past.

Moreover, the consensus of analysts is mostly bullish on CRSR. Five out of nine analysts have a buy opinion on the company, with an average target price of $33.60 per share, corresponding to an upside of 40.7%.


Since its short interest has risen, CRSR has seen increasing interest from the well-known Reddit forum, WallStreetBets. CRSR is in the top 15 of the most shorted stocks, according to Marketwatch.com, with a shorted interest of 30% of the company’s total float.

Call me a conservative, but I do not believe CRSR is a good stock to buy at its current price.  Though WallStreetBets traders are buzzing about it because of the high short interest, this is a company that lowered its 2021 outlook and its valuation is still stretched.  However, I will continue to keep an eye on the stock, as I think it’s a good company that could be a stock to your portfolio, albeit at lower prices.

Cristian Docan

Cristian is an experienced investment analyst and financial writer. Prior to Wealthpop.com, Cristian spent three years as a consultant providing investment research and content to financial services companies and online publications on the Oil & Gas sector. Cristian enjoys researching and writing about stocks and the markets. He takes a fundamental, technical and quantitative approach in evaluating stocks for readers. Previously, Cristian was Power Portfolio Manager at Engie Global Markets. Cristian started his career in portfolio management at Société Privée de Gestion de Patrimoine, an independent wealth management firm. He received a Bachelor Degree in Economics and Management at Université Panthéon-Assas University and a Master of Science in Financial Markets at INSEEC Business School.

  • 1

Leave a Comment

Your email address will not be published. Required fields are marked *


It's not goodbye, it's hello Magnifi!

You are now leaving a Magnifi Communities' website and are going to a website that is not operated by Magnifi Communities. This website is operated by Magnifi LLC, an SEC registered investment adviser affiliated with Magnifi Communities.

Magnifi Communities does not endorse this website, its sponsor, or any of the policies, activities, products, or services offered on the site. We are not responsible for the content or availability of linked site.

Take Me To Magnifi