Hey this is tom and, as you know, in my videos, the bottom line comes first, i value your time. So if you don't have the whole time to watch the video, this video is about how corsair the pc gaming hardware company is 120 undervalued. I'm gon na make a case for why this company is one of the biggest diamond in the rough cases right now in the market. Why gaming is one of the next big industries to go crazy for the next 10 years and i'm going to show the dcf the management, the business model, the financials, all the good stuff? You, like me doing in my analytics videos, but if you don't have time to watch the whole video, this was just the bottom line so enjoy it.

Go crazy. Do your thing, but if you want to stick around with me, grab a beer grab your coffee and let's get started. So, first of all, let me ask you a question: if you had to choose five industries that are going to go crazy for the next 10 years, which industries do you pick? Obviously it's cyber security cloud, ai and probably also beta, but do you choose gaming? Probably not, i think, if i say gaming, most of you will get out your pitchforks and pretty much go crazy at me, but hang on a second i'll explain why i think gaming is part of that category. Now here you go 10 years ago, 20 years ago, 30 years ago, let's say we go back to 1989 and we tell them what video games become in 2021.

They have no mental capacity to even grasp how insane what we're dealing with with games right now versus what we had in 1989. Now i remember this, but most people don't gaming, used to be arcades and malls. You used to take grandpa's money, spend too much of it. Go back the next day.

Do the same thing again and eventually grandpa would cut you off for a few days and then you go back and do it again. Then we had atari come out and revolutionize the business by bringing consoles basically bringing games inside your living room. Then we had pcs basically create personal gaming and now we're living through this whole cycle, which is completely brand new with the power of internet and how infrastructures are getting better as far as internet infrastructure, as far as pc hardware, even for casual gamers, is getting better. So now we have this combination.

Now that we went through the social media stage, gaming is becoming part of social media. In fact, most kids these days, hang out with their friends with their peers, even with people they've never met before from across the world by video games. I know that sounds crazy to some of you, but that's where it's headed and we haven't scratched the surface of how insane this is going to be as a platform that drives sales e-commerce. Basically, a lot of business is going to go through the gaming industry going to make it go ballistic.

Now, in case you don't agree with me, that's fine, but i see gaming is one of the biggest industries of 2030. It's going to go crazy. Now this company is not a game developer or publisher; they make hardware and components for gaming, in fact, they're really good at it. They have 28 of the gaming pc market, but also they lead in everything, starting from cooling solutions, pc cases, power supplies in every single category.

You can think of. They probably lead it now. Those two billion dollars in sales they have right now per year is going to be nothing because the market that they're working in and they're leading in is going to go to 50 billion dollars by 2030. In my estimation - and i think those two billion is going to be a drop in the c of the revenues they're going to be making by 2030.

now, as you can see right here, the stock actually dropped 10 and a half percent over the past month. There's 15 short interest, which means it's heavily shorted. For what reason i don't understand i'll share in a second. Their fundamentals are phenomenal check this out now.

There's one thing i want you to take a look at is the revenues, and in this section i want to show you why the revenue growth has nothing to do with covid check this out. This is 2015. 500 million. This is the current last 12 months, 2 billion, but look at the growth pattern over the last 6 years from 500 to 600 to an 855 to 937 to a billion to 1.7 billion.

Now before covet right here they still grew like crazy. You can't say that this is a covet stock. In fact, saying this makes you look like an idiot. In fact, all you need to do is just look at their ebitda 8.7 million, then 25.

30. 43. 42. 59.

64. 205. 259. Now, there's definitely some correlation here to covet actually accelerating the growth, but i believe krovitz serves as an amplifier here, not as a creator of industries.

It only amplifies processes that was supposed to happen and now they're happening faster. So there's nothing wrong with this, but as you can see, the ebitda numbers are really impressive for this company. So now, let's take a look at the balance sheet: 121 million in cash total assets of 1.33 billion dollars, out of which we have to neutralize goodwill right here, because this is just trash, so 314 gets neutralized, so it's 1 billion in assets. Now, comparing that to the total liabilities of 845, it means their liabilities versus assets are in the positive.

Now, if you neutralize the cash, which is 120 million you're getting and seventy million net debt, which is not that much for this company with two billion dollars of annual sales - and if you look at their multiples, it only gets better p e of 18. That's gap. 44, almost 45 undervalued look at this ev sales. 1.51.

65 undervalued. Look at this evie ebitda last 12 months: 11.2. 43. Undervalued.

Can you see this price to sales last 12 months? 1.31. 68, undervalued, so the multiples are extremely cheap. However, there's no reason, let me show you they have about 30 gross profit for a company that sells hardware, that's not bad at all 13 and a half percent ebitda and 7.73 net income, and obviously that's not amazing numbers. I've seen better, but i mean it's really solid, especially for a company that makes hardware there's nothing to panic about here, but for some reason the stock lost 24 in the last six months, 11 in the last three months.

So this is an opportunity, in my opinion, especially if you take a look at the revenue growth. They grew revenue by 65 ebay, the growth 230 percent over the past year, and for those of you who will say well, this is coveted induced there's definitely covered issues here, but look at the growth pattern over the last six years. It's growing like crazy way before kovaid was even a thing and if you think, i'm the only one who's saying this, let's take a look at the pranks look at this. This is from tipranks.com by the way, if you want to get a link to sign up to get a 10 discount on the premium version, there's a link below it's an affiliate link, but i've been using the software even before i had an affiliate link.

I actually was paying for this, so there's no issues for me to endorse this. I love the software look at this fifty dollars. The average tip ranks price with the current price of 28.6. Look at this i screened for five stars, so it showed me five and four and a half stars here.

So every single person here, 67, 92, 71, 29 and i'm way higher than all of them. I think it's 120 on the price they're actually way lower than me, but these are legit people look at these colin sebastian. Let's take a look at this guy. This guy is ranked number 31 in the country out of 7577 analysts.

Now what you have here, ladies and gentlemen, is a lot of smart people, agreeing with me that this company is undervalued, but now i'll show you why all of them actually are low balling. I think it's way more undervalued than they think and by the way, just want to show you this. This is andrew paul. He founded the company 1994 94.

That's 27 years ago, he's still the ceo that's one of my most favorite things in the world to have the founder steal the ceo 27 years later phenomenal. So now i want you to take a look at my dcf. So basically, i ran the dcf with a 20 annual growth, only 20 20 per year for the next five years: 101 million in capex expenditure and a 10 discount rate with 4 long term growth rate. And this is what we got 64.88 for the ebitda approach and 64.54 for the perpetual approach and by the way we used an 11.8 multiplier, because these are pc hardware companies and that's where they're trading at so 64.71, which is 126 undervalued compared to the current price Of 28.6, but again i've been wrong before and i'm not a financial advisor, so you have to do your own research.

This is just my opinion, which means it might be inaccurate might be wrong, might be even the ramblings of a madman. You have to do your own research, allegedly blah blah mother, effing blah now, as always, much appreciated that you actually stayed with me all this long. I love you all and, as always a huge thanks for the channel members and the patrons. Thank you so much for making this possible if you're a channel member or a patreon, we have a zoom call schedule for this wednesday at 7.

00 am eastern time make sure you follow the links and the passwords to get in. I think we're gon na have a really good time. Thank you. So much and i'll see you in tomorrow's video.