First Trust Advisors LP Sells 13,674 Shares of Ambarella, Inc. $AMBA

Key Points

• First Trust Advisors cut its Ambarella stake by 9.3%, selling 13,674 shares and retaining 132,938 shares valued at about $6.84 million. Institutional investors and hedge funds collectively own 82.09% of the company.
• Analyst sentiment remains positive, with a consensus “Moderate Buy” rating and an average price target of $101.12; recent targets range from $96 to $120.
• Ambarella’s latest quarter showed revenue growth of 16.9% year over year to $100.36 million and EPS of $0.11, but the company remains unprofitable. Reported acquisition discussions with NXP have renewed investor interest, though no deal has been agreed upon.

First Trust Advisors LP decreased its holdings in shares of Ambarella, Inc. (NASDAQ:AMBA - Free Report) by 9.3% during the 1st quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 132,938 shares of the semiconductor company's stock after selling 13,674 shares during the period. First Trust Advisors LP owned approximately 0.30% of Ambarella worth $6,843,000 as of its most recent SEC filing.

A number of other hedge funds have also recently made changes to their positions in the business. Summit Global Investments increased its position in shares of Ambarella by 10.4% during the first quarter. Summit Global Investments now owns 14,242 shares of the semiconductor company's stock worth $733,000 after acquiring an additional 1,336 shares in the last quarter. Cassaday & Co Wealth Management LLC bought a new position in Ambarella in the 1st quarter valued at about $30,000. Dimensional Fund Advisors LP boosted its stake in Ambarella by 28.1% during the 1st quarter. Dimensional Fund Advisors LP now owns 638,587 shares of the semiconductor company's stock valued at $32,866,000 after purchasing an additional 139,928 shares during the last quarter. Swiss National Bank boosted its stake in Ambarella by 1.0% during the 1st quarter. Swiss National Bank now owns 80,833 shares of the semiconductor company's stock valued at $4,161,000 after purchasing an additional 800 shares during the last quarter. Finally, Freemont Management S.A. increased its holdings in Ambarella by 251.9% during the 1st quarter. Freemont Management S.A. now owns 135,800 shares of the semiconductor company's stock worth $6,990,000 after purchasing an additional 97,211 shares in the last quarter. 82.09% of the stock is currently owned by institutional investors and hedge funds.

Analyst Upgrades and Downgrades

Several brokerages have recently commented on AMBA. Susquehanna increased their price objective on Ambarella from $80.00 to $110.00 and gave the stock a "positive" rating in a research note on Friday, May 29th. Weiss Ratings upgraded Ambarella from a "sell (e+)" rating to a "sell (d-)" rating in a report on Friday, July 10th. Bank of America increased their price target on Ambarella from $72.00 to $96.00 and gave the company a "neutral" rating in a research report on Friday, May 29th. Rosenblatt Securities raised their price objective on Ambarella from $115.00 to $120.00 in a research note on Tuesday, June 30th. Finally, Stifel Nicolaus set a $106.00 price objective on Ambarella in a research note on Friday, May 29th. One analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating, five have issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $101.12.

Ambarella News Summary

Here are the key news stories impacting Ambarella this week:

• Positive Sentiment: Potential NXP acquisition: NXP is reportedly in talks to buy Ambarella, whose computer-vision and AI chips are used in automotive cameras, autonomous-driving systems, security equipment and other edge-AI applications. A transaction could provide investors with a substantial premium, although no agreement, offer price or deal terms have been announced. Reuters article Financial Times article
• Positive Sentiment: Renewed edge-AI optimism: Investors are revisiting Ambarella’s growth potential in automotive and physical-AI markets. Management previously forecast quarterly revenue of $105 million to $111 million and highlighted strong edge-AI demand, while a long-term Hanwha agreement could generate more than $800 million in potential revenue. Quiver Quantitative analysis
• Neutral Sentiment: Analyst upside remains: Recent analyst price targets range from $96 to $120, with a median of $110, but these targets predate the reported acquisition discussions and may not reflect a potential takeover valuation.
• Negative Sentiment: Deal and execution risks remain: The reported talks may not result in a transaction, and Ambarella remains unprofitable on a trailing basis. Separately, disclosed insider activity showed selling rather than purchases over the past six months, a cautionary signal despite the takeover-related enthusiasm.

Ambarella Stock Performance

NASDAQ:AMBA opened at $86.00 on Monday. The firm has a market cap of $3.77 billion, a price-to-earnings ratio of -53.42 and a beta of 2.12. Ambarella, Inc. has a 52 week low of $48.30 and a 52 week high of $96.69. The firm has a 50-day moving average price of $72.56 and a two-hundred day moving average price of $66.45.

Ambarella (NASDAQ:AMBA - Get Free Report) last posted its earnings results 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 net margin of 17.18% and a negative return on equity of 10.94%. The firm had revenue of $100.36 million for the quarter, compared to analysts' expectations of $100.12 million. During the same quarter last year, the firm earned $0.07 EPS. The company's quarterly revenue was up 16.9% compared to the same quarter last year. As a group, sell-side analysts forecast that Ambarella, Inc. will post -1.13 earnings per share for the current year.

Insider Activity at Ambarella

In other Ambarella news, insider Chan W. Lee sold 2,951 shares of the business's stock in a transaction on Wednesday, June 17th. The stock was sold at an average price of $67.87, for a total value of $200,284.37. Following the transaction, the insider owned 157,098 shares of the company's stock, valued at approximately $10,662,241.26. The trade was a 1.84% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, CEO Feng-Ming Wang sold 16,250 shares of the company's stock in a transaction on Wednesday, July 1st. The shares were sold at an average price of $90.08, for a total value of $1,463,800.00. Following the completion of the transaction, the chief executive officer owned 773,607 shares of the company's stock, valued at $69,686,518.56. This trade represents a 2.06% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 91,419 shares of company stock valued at $7,591,700 in the last ninety days. Insiders own 4.50% of the company's stock.

About Ambarella

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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