This keyboard maker is a buy thanks to strong Generation Alpha gaming trends, UBS says

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This keyboard maker is a buy thanks to strong Generation Alpha gaming trends, UBS says

UBS is betting on Logitech going forward. The bank upgraded shares of the computer accessories manufacturer to buy rating from neutral. Its price target on Switzerland-listed shares of 80 Swiss francs implies upside of 26.1%. A similar gain on the U.S.-listed stock would take it to around $96.50. Logitech’s U.S.-listed shares have slipped 7% this year, making them a relative underperformer to the S & P 500, which is down 4%. “The share price has come down already, reflecting investor uncertainties, and we look through some challenging quarters,” analyst Joern Iffert wrote. “Margins and cash flows will remain on healthy levels, in our view, supported by pricing power in key products and optimized regional sourcing (away from China).” LOGI 1Y mountain LOGI 1Y stock Iffert pointed out that Logitech should be a beneficiary of gaming popularity among Generation Alpha consumers, who were born between 2010 and 2024. Approximately 94% of the generation play video games, marking a higher level of engagement versus previous generations, per UBS. “Consumer brands increasingly use gaming channels to connect to end consumers,” Iffert added. “Gamers are more likely to buy brands that they have seen in a game, with 47% of Gen Alpha stating that they bought a product or service recommended by their favorite streamer. On top of that, Logitech is already taking steps to reduce its sourcing from China. The analyst said the company’s recent internal reorganization to “better tackle the B2B business prospects” should soon yield fruit. Despite the upgrade, most analysts are neutral on the stock. Of the eight who cover Logitech, six rate it as a hold, LSEG data shows. Another two have buy ratings on shares. Logitech U.S. listed shares climbed more than 1% in the premarket after UBS’ rating change.

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