Stock Price & Analysis

Analysis and Insights

To determine whether it’s a good time to buy or sell AMBA stock, we need to analyze both technical and fundamental factors.

Technical Analysis:

AMBA's stock price has been showing signs of stability with a current price of $55.75. The stock has seen a slight increase in pre-market and regular market trading, with moderate volume of 407,955 shares traded. The price is currently above the Fibonacci pivot point of $52.69, suggesting potential upward momentum.

Fundamental Analysis:

AMBA has shown strong revenue growth of 63% year-over-year, driven by demand for edge AI applications. Despite this, the stock experienced a significant drop post-earnings, presenting a potential buying opportunity. Analysts have maintained a "Strong Buy" rating with price targets ranging from $95 to $110, indicating confidence in the stock's long-term growth.

Analyst Sentiment:

Analysts are overwhelmingly bullish on AMBA, with all recent ratings being "Strong Buy". This consensus, combined with the stock's reasonable valuation (P/S ratio of ~9), supports a positive outlook for long-term investors.

Conclusion:

Given the strong revenue growth, positive analyst sentiment, and reasonable valuation, AMBA stock is a good buy for those looking to invest in the AI sector. The recent dip post-earnings may offer a favorable entry point.

The price prediction for AMBA stock in 2025 is $70, driven by strong revenue growth of 63% year-over-year and expanding edge AI market demand. The stock is currently trading at $55.75 with a price target of $95, indicating significant upside potential.

The S1 support level for AMBA Stock is $51.86 ,The R1 resistant level for AMBA Stock is $56.18.

As of the end of day on 2025-03-26, the price of AMBA Stock was $54.27.

The target price for AMBA Stock according to analyst rating is 95.00, with the highest price target at 110.00 and the lowest at 80.00. Analysts have a Moderate Buy rating on AMBA Stock overall.

The market cap of AMBA is $2.3B.

Analysis and Insights

Valuation Metrics:

Ambarella's valuation metrics indicate a premium relative to its peers. The stock's price-to-sales (P/S) ratio is elevated at 5.7, compared to the broader technology sector's average of 7.7, suggesting investors are pricing in significant growth expectations. Additionally, the price-to-book (P/B) ratio of 2.65 reflects a premium, indicating the market's confidence in future growth.

Revenue Growth and Profitability:

Ambarella reported strong revenue growth of 63% year-over-year in its latest quarter, driven by demand for edge AI applications. However, profitability remains a concern, with a net loss of $20.23 million in Q4 2025. The gross margin of 60.55% is positive, but the net margin remains negative, highlighting the need for improved cost management.

Technical Analysis:

The stock recently entered oversold territory with an RSI of 28.5, potentially signaling a buying opportunity for bullish investors. However, the stock price has dropped 17% post-earnings, reflecting investor concerns despite strong revenue growth.

Analyst Sentiment:

Analysts have raised their revenue growth expectations, with a 12-month price target of $95, implying 55% upside. This suggests confidence in Ambarella's ability to capitalize on the expanding edge AI market.

Conclusion:

While Ambarella shows strong revenue growth and potential in edge AI, its current valuation and profitability challenges suggest it may be overvalued. Investors should consider waiting for a price correction or clearer signs of sustained profitability before entering.

Ambarella, Inc. is a developer of low-power system-on-a-chip (SoC) semiconductors that provide artificial intelligence processing, image signal processing and video compression. The Company serves human-viewing applications with video and image processors for enterprise, public infrastructure and home applications, such as Internet protocol, security cameras, sports cameras, wearables, aerial drones, and aftermarket automotive video recorders. It is focused on creating AI technology that enables edge devices to visually perceive the environment and make decisions based on the data collected from cameras and, other types of sensors. Its CVflow-architecture supports a range of computer vision algorithms, including object detection, classification and tracking, semantic and instance segmentation, image processing, stereo object detection, terrain mapping, and face recognition. Its CVflow processes other sensor modalities, including lidar, radar, time of flight, thermal and near-infrared.

The price prediction for AMBA stock by 2030 is approximately $120 per share. This forecast is based on strong revenue growth of 63% year-over-year, driven by increasing demand for edge AI applications, and a positive analyst outlook with a price target of $95, suggesting further upside potential.

AMBA has a total of 915 employees.