NEW YORK (TheStreet) -- Ambarella
(AMBA) was jumping Friday as the semiconductor processing developer said
it's working with Google (GOOG) to create a new generation of wearable cameras for the Helpouts live video instructional service. Ambarella shares were gaining 13% to $28.24.
The two companies will debut reference designs for the new wearable cameras at the Consumer Electronics Show in Las Vegas in January 2014. Ambarella's press release says the wearable cameras will have a small form factor to allow for "complete mobility during a Helpouts session." The camera would be capable of streaming and recording HD video simultaneously.
It's not clear how Google will contribute to the project. The Internet search leader is making wearable cameras for its Google Glass project. Google was adding 1.2% to $1,099.35 to extend its 2013 advance to 55%.
TheStreet Ratings team rates AMBARELLA INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:"We rate AMBARELLA INC (AMBA) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that the company's profit margins have been poor overall." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, AMBARELLA INC's return on equity exceeds that of both the industry average and the S&P 500.
- The revenue growth greatly exceeded the industry average of 10.0%. Since the same quarter one year prior, revenues rose by 28.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- AMBA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 5.15, which clearly demonstrates the ability to cover short-term cash needs.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Semiconductors & Semiconductor Equipment industry average. The net income increased by 35.9% when compared to the same quarter one year prior, rising from $6.72 million to $9.13 million.
- The gross profit margin for AMBARELLA INC is rather high; currently it is at 63.71%. Regardless of AMBA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 19.84% trails the industry average.
- You can view the full analysis from the report here: AMBA Ratings Report
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