Ambarella (NASDAQ:AMBA) Shares Down 8.9% - Here's What Happened

Key Points

• Ambarella's shares fell by 8.9% to a trading price of $76.81, with significant drops in volume compared to the average.
• Despite the recent downturn, analysts are optimistic, with BNP Paribas upgrading Ambarella to a "strong-buy" and multiple firms increasing their price targets significantly.
• Ambarella reported a positive quarterly performance, beating earnings per share estimates, with revenues up 49.9% year-over-year.

Shares of Ambarella, Inc. (NASDAQ:AMBA - Get Free Report) dropped 8.9% during trading on Friday . The stock traded as low as $76.30 and last traded at $76.81. Approximately 398,709 shares traded hands during trading, a decline of 53% from the average daily volume of 851,785 shares. The stock had previously closed at $84.28.

Analyst Upgrades and Downgrades

AMBA has been the topic of several recent analyst reports. BNP Paribas raised shares of Ambarella to a "strong-buy" rating in a research report on Friday, August 29th. Rosenblatt Securities increased their price objective on shares of Ambarella from $95.00 to $100.00 and gave the company a "buy" rating in a research report on Friday, August 29th. Morgan Stanley raised their price target on shares of Ambarella from $80.00 to $96.00 and gave the company an "overweight" rating in a report on Friday, August 29th. Bank of America raised their price target on shares of Ambarella from $63.00 to $90.00 and gave the company a "neutral" rating in a report on Friday, August 29th. Finally, Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Ambarella in a report on Wednesday. One analyst has rated the stock with a Strong Buy rating, eight have assigned a Buy rating, three have assigned a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $93.88.

Ambarella Price Performance

The firm's 50-day moving average is $76.70 and its 200-day moving average is $63.35. The company has a market capitalization of $3.24 billion, a P/E ratio of -36.01 and a beta of 2.10.

Ambarella (NASDAQ:AMBA - Get Free Report) last issued its quarterly earnings results on Thursday, August 28th. The semiconductor company reported $0.15 earnings per share for the quarter, beating the consensus estimate of $0.05 by $0.10. Ambarella had a negative net margin of 25.46% and a negative return on equity of 14.73%. The business had revenue of $95.51 million for the quarter, compared to the consensus estimate of $90.01 million. During the same quarter in the previous year, the firm earned ($0.13) earnings per share. The company's revenue for the quarter was up 49.9% on a year-over-year basis. Ambarella has set its Q3 2026 guidance at EPS. As a group, analysts forecast that Ambarella, Inc. will post -2.81 EPS for the current fiscal year.

Insider Transactions at Ambarella

In other news, VP Yun-Lung Chen sold 8,492 shares of the business's stock in a transaction on Wednesday, September 10th. The shares were sold at an average price of $84.42, for a total value of $716,894.64. Following the transaction, the vice president owned 61,651 shares of the company's stock, valued at approximately $5,204,577.42. The trade was a 12.11% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Elizabeth M. Schwarting sold 2,664 shares of the business's stock in a transaction on Monday, October 6th. The stock was sold at an average price of $85.38, for a total transaction of $227,452.32. Following the completion of the transaction, the director directly owned 7,314 shares in the company, valued at $624,469.32. This trade represents a 26.70% decrease in their position. The disclosure for this sale can be found here. In the last three months, insiders have sold 24,014 shares of company stock valued at $1,965,658. 5.30% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Ambarella

A number of hedge funds have recently bought and sold shares of the business. Heritage Family Offices LLP purchased a new stake in Ambarella during the third quarter valued at $237,000. Total Investment Management Inc. purchased a new stake in shares of Ambarella in the second quarter valued at $30,000. Cim Investment Management Inc. raised its stake in shares of Ambarella by 100.7% in the second quarter. Cim Investment Management Inc. now owns 8,698 shares of the semiconductor company's stock valued at $604,000 after acquiring an additional 4,365 shares during the period. State of Wyoming purchased a new stake in shares of Ambarella in the second quarter valued at $63,000. Finally, Tower Research Capital LLC TRC raised its stake in shares of Ambarella by 1,597.1% in the second quarter. Tower Research Capital LLC TRC now owns 6,924 shares of the semiconductor company's stock valued at $457,000 after acquiring an additional 6,516 shares during the period. Hedge funds and other institutional investors own 82.09% of the company's stock.

Ambarella Company Profile

Ambarella, Inc develops semiconductor solutions that enable high-definition (HD) and ultra HD compression, image signal processing, and artificial intelligence processing worldwide. The company's system-on-a-chip designs integrated HD video processing, image processing, artificial intelligence computer vision algorithms, audio processing, and system functions onto a single chip for delivering video and image quality, differentiated functionality, and low power consumption.

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