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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Ambarella Inc (XNAS:AMBA) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AMBA
Name:
AMBARELLA INC (XNAS:AMBA)
Sector:
- 6501.00K
Industry:
Semiconductor Equipment & Materials
CEO:
Dr. Feng-Ming Wang
Total Employees:
899
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -165.82% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AMBARELLA INC(AMBA) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SEMICONDUCTOR EQUIPMENT & MATERIALS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
62.86
One Month Price Target:
$63.4
Six Month Price Target :
$66.11
Likely Price in One Year's Time:
Ticker:
$69.36
Likely Trading Range Today Under (Normal Volatility)
$62.48
Price Upper limit ($) :
$63.39
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$57.42
This week:
$50.69
This month :
$38.51
Other Primary facts
Market Cap:
2.36B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
38.12M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
27.41%
-31.3%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$88.11
$76.47
$37.61
$49.25
Medium risk (<10%) entry points
Buy Call
Sell Call
$72.68
Buy Put:
Sell Put:
$70.20
$53.00
$55.52
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AMBA
Sharpe Ratio:
2.45%
Comparison:
AMBA, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -11.57% lower than the industry
& ratio is 7.63% higher than the market/S&P 500 average
Average Returns/Yield of
AMBA
Daily returns:
0.11%
Weekly returns:
0.57%
Monthly returns:
2.27%
Yearly returns:
28.31%
Comparison of returns:
Average annual returns/yield (last 3 years) is -3.64% below industry average
Classification:
AMBA, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.61
Statistical test of Returns:
AMBA has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.27%
Weekly Volatility:
9.55%
Monthly Volatility:
19.11%
Yearly Volatility:
66.19%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
8.86%
Volatility in last five trading days has been 107.28% above long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.66%
Weekly VaR:
-19.37%
Monthly VaR:
-38.73%
How Much Can the price of
AMBA
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-33%
Worst case (decline):
>85%
This translates to price declining to:
$42.15
This translates to price declining to:
$9.43
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AMBA is a 173.36% riskier investment compared to the market/S&P 500 & is 134.19% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 14.06% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AMBA
Beta in relation to market/S&P 500--1.54
Expected beta in 1 year's time:
1.349
Expected beta in 3 year's time:
1.908
Unlevered (debt free) Beta:
1.515
Beta in relation to Nasdaq (XNAS):
1.524
Beta in relation to all global stocks::
0.779
Beta Comparison & Analysis
Beta of competitors/peers::
1.666
Beta is -7.61% lower than peers
Average Industry Beta:
1.394
Beta is 10.37% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.136
Alpha is -12.95% below industry average alpha yield
Alpha is 865% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AMBA
Equity cost of capital:
0.137
Equity cost of capital is 7.80% above industry mean WACC
Unlevered (without debt) cost of capital:
13.48%
Before-tax cost of debt:
-
After-tax cost of debt:
-
Overall debt rating:
-
Weighted average cost of capital (WACC):
-
-
Key Per-Share Metrics & Analysis
Revenue per share:
$9.23
Revenue growth rate per share of (3Y):
4.88
Annual revenue growth rate is -148.56% below industry average
EPS:
-$0.71
Expected Annual growth rate of EPS (3Y):
-8.18%
Expected future EPS growth rate is -126.32% lower than the Semiconductor Equipment & Materials industry
Free cash flow (FCF) per share:
$2.07
-
-
Debt per share
$0.22
EBITDA per share
-$0.36
Valuation Analysis Today of
AMBA
P/E Ratio:
-
P/E Ratio of Competitors/Peers:
927.03
-
-
AMBA is -408.49% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
6.81
Price to sales ratio is 6.34% above the industry mean
P/B (Price to book value ratio):
4.88
Price to free cash flow: 30.40
Price to free cash flow ratio is 297.73% higher than the industry
Net income growth rate (3Y):
-403.83%
Net income growth rate is -159.04% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
1.73%
Net debt to equity ratio:
-43.97%
Debt to assets ratio:
1.45%
Net debt to assets ratio:
-36.95%
Debt-to-asset ratio is -97.09% below industry average
Ability to repay debt:
Interest coverage ratio:
-
-
Looking forward:
Debt growth rate:
2.76%
Annual debt growth is 246% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.582
Statistical significance of correlation:
AMBA has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.604
Stock price is -3.56% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.604
Correlation of price movement with Nasdaq (^IXIC):
0.007
Covariance of price movement with the market:
0.018
Kurtosis
8.173
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.463
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AMBA
Gross Profit Margin Ratio:
251%
Operating Profit Margin Ratio:
-8.52%
Operating profit margin is 89.88% higher than the industry
Net Profit Margin Ratio:
251%
Effective Tax Rate:
10.49%
Effective tax rate is -19.36% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-5.38%
Return on equity (ROE) is -137.82% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-4.52%
Return on assets (ROA) is -152.38% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
7.26
Current ratio is 65.55% above industry average
Cash Conversion Cycle (days):
4.8
Cash conversion cycle is -91.83% below industry average
The remaining useful life of property plant & equipment is: 2.5 years
Stock based compensation to net income ratio:
-71.33%
In-depth Efficiency Analysis
Revenue generated per employee:
391.6K
Each employee generates -33% less revenue than industry average revenue per employee
EBITDA generated per employee:
- 15.3K
Each employee generates -109% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 29.4K
Each employee generates -127% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 7.2K
Each employee generates -142% less free cash flow than industry average revenue per employee
Assets/Capital per employee
84.6K
Each employee generates -142% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 8.51%
Growth rate in R&D investment/expenditure is -64.06% lower than the industry
Competitors/Peer firms of
AMBA
BUMBLE INC. (XNAS:BMBL)
AMKOR TECHNOLOGY, INC. (XNAS:AMKR)
Braze, Inc. (XNAS:BRZE)
Novanta Inc. (XNAS:NOVT)
FRESHWORKS INC. (XNAS:FRSH)
ALLEGRO MICROSYSTEMS, INC (XNAS:ALGM)
LUMINAR TECHNOLOGIES, INC. (XNAS:LAZR)
MICROSTRATEGY INCORPORATED (XNAS:MSTR)
-
Current Analyst Ratings
Strong buy�13%
Buy�4%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
352.03M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
131.11M
220.91M
176.15M
-
74.77M
-
-
250.92M
-
-
15.73M
- 13778.00K
- 30005.00K
- 26415.00K
- 29510.00K
- 3095.00K
- 26415.00K
Statement of Cash Flow
Date:
Period:
2.88M
Differed Income Tax :
433.00K
Stock Based Compensation :
18.84M
Change in Working Capital :
- 16114.00K
Accounts Receivables:
- 9554.00K
Other Working Capital:
- 74.00K
Other Non-Cash Items:
227.00K
Net Cash Provided by Operating Activities:
- 4547.00K
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
- 57117.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
227.51M
208.02M
435.53M
34.53M
33.12M
5.37M
508.55M
17.08M
26.60M
17.29M
-
10.48M
4.63M
76.09M
-
584.64M
20.64M
2.99M
700.00K
770.00K
45.60M
70.00M
8.48M
13.58M
23.34M
-
93.34M
16.00K
115.47M
792.0K
375.02M
April 30, 2021 at 6:00:00 AM
382.03M
491.29M
584.64M
-
11.47M
- 216042.0K
47.84M
- 1954.00K
- 11230.00K
-
-
-
-
2.01M
2.01M
-
- 13765.00K
227.52M
241.28M
- 4547.00K
- 1954.00K
- 6501.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
AMBA
2023
2024
2025
2026
2027
$69.58
$76.77
$84.71
$93.47
$103.14