Zacks Investment Research Lowers Ambarella (AMBA) to Sell

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Zacks Investment Research downgraded shares of Ambarella (NASDAQ:AMBA) from a hold rating to a sell rating in a research note issued to investors on Wednesday morning.

According to Zacks, “Ambarella's Q3 results hurt from continued decline in revenues from consumer applications, including sports, VR and the drone cameras. This downtrend is expected to continue. Transition of the business away from consumer electronic applications toward computer vision coupled with geopolitical and macroeconomic challenges are taking a toll on the company’s revenues. Ambarella is also hurt by decline in chip sales to GoPro. Shares have underperformed the industry on a year-to-date basis. Nonetheless, Ambarella expects the demand for security cameras with computer vision capability to continue to grow, giving it an opportunity to increase its value contribution per camera, and hence boost top-line.”

Several other analysts have also issued reports on AMBA. TheStreet lowered shares of Ambarella from a c- rating to a d rating in a research report on Friday, November 30th. Needham & Company LLC reiterated a hold rating on shares of Ambarella in a research report on Friday, November 30th. ValuEngine lowered shares of Ambarella from a buy rating to a hold rating in a research report on Wednesday, October 3rd. Roth Capital increased their price target on shares of Ambarella to $40.00 and gave the stock a neutral rating in a research report on Friday, November 30th. Finally, BidaskClub upgraded shares of Ambarella from a sell rating to a hold rating in a research report on Tuesday, October 16th. Two equities research analysts have rated the stock with a sell rating, seven have issued a hold rating and six have assigned a buy rating to the company’s stock. The stock has a consensus rating of Hold and a consensus target price of $48.95.

Shares of NASDAQ:AMBA opened at $38.09 on Wednesday. Ambarella has a 12-month low of $30.00 and a 12-month high of $66.23. The company has a market cap of $1.26 billion, a price-to-earnings ratio of 69.25 and a beta of 1.09.

Ambarella (NASDAQ:AMBA) last announced its earnings results on Thursday, November 29th. The semiconductor company reported ($0.28) earnings per share (EPS) for the quarter, missing the Zacks’ consensus estimate of ($0.27) by ($0.01). Ambarella had a negative return on equity of 5.21% and a negative net margin of 9.97%. The business had revenue of $57.30 million for the quarter, compared to analyst estimates of $57.12 million. During the same quarter in the previous year, the company earned $0.75 EPS. The business’s revenue for the quarter was down 35.7% on a year-over-year basis. Sell-side analysts expect that Ambarella will post -1.02 earnings per share for the current year.

In related news, insider Leslie Kohn sold 6,799 shares of the stock in a transaction that occurred on Wednesday, September 19th. The shares were sold at an average price of $35.46, for a total value of $241,092.54. Following the completion of the transaction, the insider now owns 916,795 shares of the company’s stock, valued at approximately $32,509,550.70. The sale was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, VP Christopher Day sold 1,533 shares of the stock in a transaction that occurred on Wednesday, September 19th. The shares were sold at an average price of $35.51, for a total transaction of $54,436.83. The disclosure for this sale can be found here. Insiders have sold a total of 43,081 shares of company stock worth $1,610,488 in the last quarter. 5.84% of the stock is currently owned by company insiders.

A number of large investors have recently modified their holdings of the stock. Vanguard Group Inc. lifted its stake in Ambarella by 2.5% in the 3rd quarter. Vanguard Group Inc. now owns 2,407,044 shares of the semiconductor company’s stock valued at $93,104,000 after purchasing an additional 57,943 shares during the last quarter. Van Berkom & Associates Inc. lifted its stake in Ambarella by 10.7% in the 3rd quarter. Van Berkom & Associates Inc. now owns 1,714,636 shares of the semiconductor company’s stock valued at $66,322,000 after purchasing an additional 165,433 shares during the last quarter. BlackRock Inc. lifted its stake in Ambarella by 2.5% in the 3rd quarter. BlackRock Inc. now owns 1,690,551 shares of the semiconductor company’s stock valued at $65,392,000 after purchasing an additional 41,782 shares during the last quarter. Pinnacle Associates Ltd. lifted its stake in Ambarella by 5.8% in the 2nd quarter. Pinnacle Associates Ltd. now owns 953,325 shares of the semiconductor company’s stock valued at $36,808,000 after purchasing an additional 52,391 shares during the last quarter. Finally, Janus Henderson Group PLC lifted its stake in Ambarella by 16.4% in the 2nd quarter. Janus Henderson Group PLC now owns 948,168 shares of the semiconductor company’s stock valued at $36,614,000 after purchasing an additional 133,475 shares during the last quarter. 80.17% of the stock is owned by institutional investors and hedge funds.

About Ambarella

Ambarella, Inc develops semiconductor processing solutions for video that enable high-definition (HD), video capture, analysis, sharing, and display worldwide. The company's system-on-a-chip designs integrated HD video processing, image processing, computer vision functionality, 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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