Fundamental Analysis: LOGITECH INTERNATIONAL SA. (#LOGI)

Logitech (#LOGI) is a Swiss company that manufactures computer peripherals (mouses, trackballs, game controllers, keyboards, PC video cameras and multimedia speakers).

About a third of sales are from US customers.

The company has a large manufacturing facility in China and produces about 50% of its products there: We consider the stock for our "Optimal risk" portfolio at $ 87.94.


Key factors:


1) Excellent financial results for the 2nd quarter of 2021.

In the second quarter of fiscal year 2020, Logitech has increased revenue by 74.7% to $1 billion.

The quarterly EBlTDA rose by 280% to $339.6 million and company's net profit grew by 266%, reaching $268.2 million.

The company has significantly increased its cash streams: free cash flow were up at $264.2 million.


2) Strong financial situation.

In 2021 the financial performance is expected to grow further. Thus, according to Bloomberg's consensus forecast, profit can increase by 38% and EBlTDA by almost 90 %.

At the same time, the company has an impressive supply of cash of approx. 900million.

As a result, at the end of last quarter were reported net cash position for $881 million.


3) The popularity of eSports can play in favour for Logitech.

The main trigger is company's partnership with the developer Riot Games gaming technology and equipment.

As part of the project Logitech G, it will be presented a portfolio of new game products: the gaming environment is indeed of great attraction for the company's consumer audience, which is estimated at 2.7 billion people.

This could lead to growth above average, for the #LOGI's profits for two to five years. The popularity of E-sports is growing, the market capacity in 2021 is estimated to be different and can reach up to $1, 1 billion.


Considering an expected growing sales of video games: Logitech (#LOGI) has a great opportunity to increase its market share.

OTB Global Investments

London, 11 December 2020

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