Today's Dead Cat Bounce Stock Is Ambarella (AMBA)
Trade-Ideas LLC identified
(
) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Ambarella as such a stock due to the following factors:
- AMBA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.8 million.
- AMBA has traded 120,866 shares today.
- AMBA is up 3.3% today.
- AMBA was down 7.4% yesterday.
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More details on AMBA:
Ambarella, Inc. develops semiconductor processing solutions for video that enable high-definition (HD) video capture, sharing, and display worldwide. AMBA has a PE ratio of 17. Currently there are 8 analysts that rate Ambarella a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Ambarella has been 1.3 million shares per day over the past 30 days. Ambarella has a market cap of $1.2 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.53 and a short float of 33% with 9.94 days to cover. Shares are down 36.5% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Ambarella as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, good cash flow from operations and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- AMBA's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 5.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in 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 7.11, which clearly demonstrates the ability to cover short-term cash needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. 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.
- Net operating cash flow has significantly increased by 84.20% to $30.32 million when compared to the same quarter last year. In addition, AMBARELLA INC has also vastly surpassed the industry average cash flow growth rate of 11.68%.
- AMBARELLA INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, AMBARELLA INC increased its bottom line by earning $2.26 versus $1.56 in the prior year. This year, the market expects an improvement in earnings ($2.41 versus $2.26).
- You can view the full Ambarella Ratings Report.
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