Shares of Corsair Gaming (CRSR -0.87%) fell 12.3% last month, according to data provided by S&P Global Market Intelligence. While there wasn't any company-specific news to send the stock down, it started to fall in late June after a Goldman Sachs analyst downgraded Logitech International (LOGI -0.19%), one of Corsair's top peers in the industry, to neutral from a buy rating.
This week, Corsair reported strong sales growth and reiterated its full-year outlook, but the stock fell sharply after adjusted earnings per share came in below estimates.
The shares are currently down 25% year to date, underperforming both the Nasdaq Composite index and Logitech.
From a value perspective, it doesn't make sense for investors to sell shares of Corsair Gaming. Second-quarter results show that demand for PC upgrades and livestreaming peripherals remains robust. Total net revenue grew 24.3% year over year, driven by 40.9% growth in its gamer and creator peripherals segment and 17.6% growth in the systems segment.
The main issue that explains the stock's fall after earnings is the miss on the bottom line, with adjusted EPS of $0.36 coming in shy of the consensus estimate of $0.39. The company attributed this shortfall to higher logistics costs, which it expects to remain elevated through the third quarter.
But CEO Andy Paul sees a strong business right now. "Our results highlight the strength of the underlying fundamentals of our business, as gamers continue to purchase and upgrade their gear, even as entertainment outside of the home and travel began to open back up," Paul said.
The latest earnings results and outlook could make the sell-off a buying opportunity. Management still sees full-year revenue growing by 12% to 24% year over year, reaching between $1.7 billion and $2.1 billion for 2021. This would be nearly double the $1.1 billion achieved in 2019.
The stock now trades at 14.3 times trailing free cash flow, which looks cheap for a top gaming accessories provider serving a growing video game industry. This tech stock looks like a terrific value right now, and other investors seem to agree.