Meme stock favorite Corsair (CRSR) is getting whacked again on supply chain problems.
The company said it now expects third-quarter revenue of $391 million vs. an analyst consensus of $485.2 million.
And for the full-year, it expects revenue of $1.83 to $1.93 billion, below the current consensus of $2.05 billion.
I’m long Corsair call options, so i’m not happy about what I’m seeing. At all.
But I have to wonder if the drop in Corsair is an opportunity.
The PC gaming industry does not have a demand problem.
It has a supply problem.
The industry can’t get enough supply of vital parts - notably GPUs from Nvidia (NVDA) and AMD (AMD).
That means there aren’t enough new computers to satisfy the demand of gamers.
(Interestingly, Apple (AAPL) does not seem to be suffering from these shortages… yet.)
Corsair is likely to drop as earnings estimates collapse.
But around $20ish, it gets VERY interesting.
Why?
Because eventually, supply will come back online, especially as the pandemic picture improves.
Second, Corsair is an incredibly valuable brand. So a larger company like Logitech (LOGI), Dell, or HP (HPQ) could acquire be interested in acquiring Corsair. That would be instant exposure to the booming PC gaming/streaming market.
Stay tuned… we’ll be talking about this one again soon.