I’m Selling Software to Buy These 3 Hardware Stocks

For the last 18 months, my portfolio has been heavy on software. It was the easy trade. But lately, the charts look crowded. The easy money in the cloud infrastructure trade feels... done.

I’m rotating capital.

Here is the thesis: AI is moving from the data center to the device. We are staring down the barrel of CES 2026 in January, and the narrative is shifting to "Edge AI." Plus, with the new 2025 privacy mandates, companies basically have to process data locally on devices to stay compliant.

So I went looking for the outliers. I wanted companies that sell the physical boxes, chips, and tools that make this transition possible.

I don't just pick these tickers out of a hat. I have a strict process. If you're new to my analysis, I run every potential candidate through a filter to strip out the emotion. You can check out my 10x Stock Checklist: My Exact 47-Point Analysis Framework if you want to see the specific criteria I use to avoid value traps.

Here are the three that passed the screen for December.

1. SharkNinja (SN) - The Execution Machine

Most people ignore this stock because they think "vacuum cleaners." That’s a mistake.

I like SharkNinja because they operate like an algorithm, not a typical appliance company. They identify a category where the incumbent is lazy and overpriced—like Dyson in vacuums or high-end beauty tools—and they engineer a product that is 90% as good for 50% of the price.

They are currently ripping through the European market. While everyone else is worried about a consumer slowdown, they are growing revenue at double digits. It’s boring, profitable, and relentless.

The financials looked good, but I had to be sure. So I ran it through my 10x Stock Checklist: My Exact 47-Point Analysis Framework... and it passed the "Management Integrity" check with flying colors. They don't overpromise; they just ship.

• Price: ~$101.39
• Market Cap: $13.6B
• Revenue Growth: +14.3% (Q3 '25)
• Gross Margin: 48.8%
• Moat: Speed-to-market. They iterate faster than anyone else.

2. Corsair Gaming (CRSR) - The Deep Value Pivot

This is the risky one.

Corsair was the darling of the pandemic, then it crashed. For a long time, it looked like a "dead money" trade. But something changed in the last quarter. They’ve pivoted hard into "Sim Racing" and high-end creator peripherals.

The gaming hardware cycle is roughly four years. We are hitting that replacement window right now, just as the hype for GTA VI starts building for next year. The CEO sees it too—he bought ~$305k worth of stock on the open market last week. When insiders buy with their own cash, I pay attention.

I don't trust the numbers blindly. I pull up the chart on TradingView to check the Volume Profile. If you aren't using their advanced charts yet, you should... it saves me hours of headaches. I specifically look for a divergence where price is low but accumulation volume is high.

For a stock like this, I also use the Pro Screener to filter for "Market Cap < $2B" and "Rel Vol > 2". It's the easiest way to spot momentum before the news does.

• Price: ~$6.45
• Market Cap: $714M
• Insider Activity: CEO Buying (Nov 2025)
• Gross Margin: 26.8% (and expanding)
• Catalyst: CES 2026 announcements for the new Sim Racing ecosystem.

3. Ambarella (AMBA) - The "Eyes" of AI

This is my "Pick and Shovel" play.

Nvidia owns the data center. But you can't put an H100 GPU inside a security camera or a doorbell. It uses too much power and costs too much. That is where Ambarella wins.

They make the CV3 domain controller chips. These are the processors that allow robots, cars, and cameras to "see" and process that visual data locally. The inventory correction that crushed them last year seems to be over. Revenue acceleration is back up to 31%.

This isn't a cheap stock, but it's the only pure-play way I’ve found to invest in the physical infrastructure of autonomous robotics without buying a car company.

• Price: ~$71.09
• Market Cap: $3.0B
• Revenue Growth: +31.2%
• Cash Runway: ~20 Months ($295M Cash)
• Primary Risk: Valuation. It is priced for perfection.

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The Reality Check

I want to be clear... I could be wrong.

These are high-conviction plays, but they have flaws. SharkNinja is heavily exposed to China manufacturing, so if tariffs spike in 2026, their margins get crushed. Corsair has a debt load that makes me nervous—if interest rates stay high, that debt gets expensive. And Ambarella is still unprofitable on a GAAP basis; if the Edge AI narrative stalls, the stock drops 20% overnight.

My Plan

I am looking to open a position in SharkNinja first. It provides the ballast. I want to see it hold above $100.

For Corsair, I am nibbling here at $6.45, but keeping my stop-loss tight. It’s a turnaround play, and turnarounds often turn slowly.

Investing in small and mid-caps is a minefield. If you want to see exactly how I vet these companies to avoid zeroes, grab my 10x Stock Checklist: My Exact 47-Point Analysis Framework. It helps me stay objective when the hype gets loud.

I'll update you all after CES.