Oppenheimer Remains Sidelined on Ambarella (AMBA) Following 3Q
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Oppenheimer reiterated a Perform rating on Ambarella (NASDAQ: AMBA) following the company's 3Q earnings report. Revenues were up 54% Q/Q and 8% Y/Y due to a strong recovery of wearable revenues. wearable sales recovered in F3Q due to GoPro's releases into holiday season. On November 30, GoPro reported 35% Y/Y growth of unit sales during Black Friday Week. Management reiterated confidence in the camera drone market. It believes this segment's weaker than expected results were due to short-term yield issues rather than lack of consumer appetite.
Analyst Andrew Uerkwitz commented, "AMBA reported F3Q17 revenue/EPS of $100.5M/$1.11 vs. Street's $97.3M/$0.94 and our $93.2M/$0.91. Quarterly revenue exceeded the $100M mark for the first time, but management cut celebrations short with a cautious near-term outlook on the drone and wearables markets. IP camera market dynamics are unchanged: strong momentum on North American consumer and plenty of uncertainty in China related to state spending on security cameras. Management believes it is too early to turn positive on wearables but drone-related weakness should be short-lived. We are taking a more prudent outlook into AMBA's FY18 (ending Jan '18), as uncertainties in multiple end markets will cloud visibility before its computer vision chip brings new growth opportunities."
For an analyst ratings summary and ratings history on Ambarella click here. For more ratings news on Ambarella click here.
Shares of Ambarella closed at $61.39 yesterday.
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