NEW YORK (TheStreet) -- Shares of Ambarella Inc (AMBA) were retreating, lower by 1.21% to $112.66 on heavy volume in midday trading Wednesday, after Citigroup issued a note earlier today saying it sees "slimmer" odds of GoPro (GPRO) cameras going mainstream.
Shares of Ambarella, which makes chips that process video for a number of companies including GoPro, are trading lower after Citigroup analysts cut their shipment forecasts for GoPro's action camera following results from consumer surveys.
The firm now expects GoPro to ship 9.3 million cameras by 2018, down from its previous forecast of 10.6 million units, according to MarketWatch.
Citigroup's survey showed that 5% of consumers plan to buy an action camera in the next 12 months, down from 7% a year ago.
Citi analysts also noted that the growth of drones may also slow growth in the space.
About 3.56 million shares have changed hands as of 12:31 p.m. ET today, compared to its average trading volume of about 2.34 million shares a day.
Santa Clara, Calif.-based Ambarella is a developer of semiconductor processing solutions for video that enable high-definition, video capture, sharing and display.
The company's system-on-a-chip designs HD video processing, image processing, audio processing and system functions onto a single chip, delivering video and image, according to Reuters.
Separately, TheStreet Ratings team rates AMBARELLA INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate AMBARELLA INC (AMBA) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and impressive record of earnings per share growth. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value."