Ambarella (NASDAQ:AMBA) Stock Rating Lowered by Summit Insights

Key Points

• Summit Insights downgraded Ambarella from buy to hold, even though other analysts remain more positive overall. The stock still carries an average Wall Street rating of Moderate Buy with a $96.75 price target.
• Ambarella’s latest quarterly results were solid, with EPS of $0.11 meeting expectations and revenue of $100.36 million slightly beating estimates. Revenue also rose 16.9% year over year, showing continued growth.
• The company also highlighted future upside from its business outlook, including Q2 revenue guidance of $105 million to $111 million and a long-term edge-AI agreement with Hanwha that could produce more than $800 million in potential revenue over 10+ years.

Ambarella (NASDAQ:AMBA - Get Free Report) was downgraded by analysts at Summit Insights from a "buy" rating to a "hold" rating in a report released on Friday.

AMBA has been the topic of several other reports. Rosenblatt Securities restated a "buy" rating and issued a $115.00 price objective on shares of Ambarella in a research report on Tuesday. Stifel Nicolaus set a $106.00 price objective on Ambarella in a research report on Friday. Consumer Edge restated a "buy" rating on shares of Ambarella in a research report on Friday, May 22nd. Finally, Bank of America restated a "neutral" rating on shares of Ambarella in a research report on Friday. One equities research analyst has rated the stock with a Strong Buy rating, seven have assigned a Buy rating, five have assigned a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat.com, Ambarella currently has an average rating of "Moderate Buy" and an average price target of $96.75.

Ambarella Price Performance

Shares of AMBA opened at $91.84 on Friday. Ambarella has a one year low of $48.30 and a one year high of $96.69. The firm has a market capitalization of $4.03 billion, a P/E ratio of -51.60 and a beta of 2.17. The business has a fifty day moving average of $65.50 and a 200 day moving average of $68.42.

Ambarella (NASDAQ:AMBA - Get Free Report) last issued its quarterly earnings data on Thursday, May 28th. The semiconductor company reported $0.11 EPS for the quarter, hitting the consensus estimate of $0.11. Ambarella had a negative return on equity of 12.16% and a negative net margin of 19.42%.The company had revenue of $100.36 million during the quarter, compared to analyst estimates of $100.12 million. During the same quarter in the previous year, the company posted $0.07 earnings per share. Ambarella's revenue was up 16.9% compared to the same quarter last year. Analysts expect that Ambarella will post -1.27 EPS for the current fiscal year.

Insider Buying and Selling

In other news, VP Chi-Hong Ju sold 2,155 shares of the company's stock in a transaction that occurred on Thursday, March 19th. The stock was sold at an average price of $54.14, for a total transaction of $116,671.70. Following the transaction, the vice president owned 167,941 shares of the company's stock, valued at approximately $9,092,325.74. This represents a 1.27% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. Also, insider Chan W. Lee sold 3,641 shares of the company's stock in a transaction that occurred on Thursday, March 19th. The shares were sold at an average price of $54.14, for a total value of $197,123.74. Following the transaction, the insider directly owned 160,049 shares in the company, valued at approximately $8,665,052.86. This represents a 2.22% decrease in their position. The SEC filing for this sale provides additional information. Over the last ninety days, insiders sold 136,799 shares of company stock valued at $8,917,902. Insiders own 4.50% of the company's stock.

Institutional Trading of Ambarella

Hedge funds have recently bought and sold shares of the stock. Essential Partners LLC lifted its holdings in Ambarella by 90.1% during the first quarter. Essential Partners LLC now owns 481 shares of the semiconductor company's stock worth $25,000 after buying an additional 228 shares during the period. EverSource Wealth Advisors LLC raised its stake in Ambarella by 362.2% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 416 shares of the semiconductor company's stock worth $27,000 after acquiring an additional 326 shares during the last quarter. Cassaday & Co Wealth Management LLC purchased a new position in Ambarella in the 1st quarter worth $30,000. Advisory Services Network LLC purchased a new position in Ambarella in the 3rd quarter worth $33,000. Finally, Steward Partners Investment Advisory LLC raised its stake in Ambarella by 162.5% in the 4th quarter. Steward Partners Investment Advisory LLC now owns 525 shares of the semiconductor company's stock worth $37,000 after acquiring an additional 325 shares during the last quarter. Hedge funds and other institutional investors own 82.09% of the company's stock.

Ambarella News Summary

Here are the key news stories impacting Ambarella this week:

• Positive Sentiment: Ambarella reported fiscal Q1 revenue of $100.4 million, up 16.9% year over year, with EPS of $0.11 matching estimates and revenue slightly topping expectations, suggesting execution remains on track. Ambarella (AMBA) Meets Q1 Earnings Estimates
• Positive Sentiment: The company also guided Q2 revenue to $105 million-$111 million, which was above the consensus view at the midpoint, helping support the stock’s move. Ambarella outlines $105M-$111M Q2 revenue while Hanwha agreement targets $800M+ over 10+ years
• Positive Sentiment: Ambarella announced a long-term edge-AI agreement with Hanwha that could generate more than $800 million in potential revenue over 10+ years, a meaningful validation of its platform and future demand outlook. Hanwha and Ambarella Enter Into Long-Term Edge AI Agreement
• Positive Sentiment: Analysts turned more constructive after the report, with Needham’s Quinn Bolton reiterating Buy and raising his target to $100, while Bank of America’s Vivek Arya lifted his target to $96, both pointing to longer-dated edge-AI upside. Quinn Bolton Reiterates Buy on Ambarella, Sets $100 DCF-Based Price Target on Strengthening Auto, Robotics, and Long-Term Deal Momentum
• Neutral Sentiment: Ambarella’s CEO and CFO disclosed pre-arranged stock sales under 10b5-1 plans, which investors may view as routine rather than a major signal. MarketBeat AMBA insider transactions

Ambarella Company Profile

Ambarella, Inc is a global semiconductor company headquartered in Santa Clara, California, specializing in video compression, image processing and computer vision technologies. The company designs low-power, high-definition system-on-chip (SoC) solutions that enable the capture, processing and streaming of video in a variety of embedded applications. Ambarella's platforms combine advanced video encoding, multi-core central processing units and hardware accelerators to deliver high-resolution imaging with low power consumption.

Ambarella's product portfolio caters to multiple markets, including security and surveillance, automotive vision, wearable cameras, drones and robotics.

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