Barclays says buy this underappreciated name in consumer hardware

Logitech is poised to beryllium a semipermanent victor successful user hardware, making present a bully clip for investors to bargain according to Barclays.

The slope connected Wednesday initiated sum of the institution with an overweight standing and terms people of $65. That implies upside of much than 19%.

The steadfast sees Logitech arsenic "the astir underappreciated subordinate successful the space, with easier compares and a replacement rhythm connected the skyline led by gaming," expert Tim Long wrote successful a Nov. 9 note.

"LOGI has successfully transitioned from a mono-brand with PC dependency to a multi-brand and multi-category unreality peripherals institution nether the champion of breed CEO Bracken Darrell," Long added. "LOGI is simply a marketplace person successful two-thirds of its 30 merchandise categories."

There are respective tailwinds that could thrust Logitech successful the future, including charismatic maturation drivers successful video collaboration and gaming.

The institution besides holds the apical marketplace stock successful each 3 verticals of its creativity and productivity segment, which is profitable. There's a affirmative premix displacement arsenic wireless gaming peripherals and video collaboration person supra mean margins.

Logitech has "tremendous" marque consciousness and could seizure adjacent much stock gains done plan and innovation, Long wrote. There are coagulated tuck-in acquisition opportunities that could spur growth, and the institution has a beardown equilibrium expanse and accordant superior returns, according to the note.

There's besides a steadfast upside to shares, making the existent terms an charismatic introduction point. Plus, determination are maturation catalysts successful the near-term that volition assistance shares, specified arsenic the company's reaffirmation of its full-year 2023 guidance which indicates assurance successful the upcoming vacation quarter, which is expected to relationship for one-third of full-year profits.

To beryllium sure, determination are imaginable catalysts that could measurement connected shares and marque Barclays telephone incorrect.

The upcoming macroeconomic backdrop could deed user assurance and spending. In addition, the institution does look accrued contention successful the user hardware abstraction and could spot its marketplace stock eroded owed to a deficiency of accumulation innovation.

"We deliberation these risks are good understood and baked into the shares already," Long wrote.

— CNBC's Michael Bloom contributed reporting