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Hot stock of the month – Drone Play

June 6th, 2015 by Ram Muthiah

Ever heard of Ambarella Inc? It’s a semiconductor company making chips. Boring stuff, right? So far the stock has risen 87%. These folks make chips that go into many of GoPro’s cameras. On top of it, Ambarella makes chips for drone cameras as well. GoPro is going big on drones. For a smart drone play, Ambarella is the better bet than GoPro.

Ambarella announced earnings on Wednesday. The company significantly beat Wall Street’s revenue estimate of $67 million, coming in at $71 million for the quarter, a 73.5% increase year-over-year. Many analysts increased the price target to $123. The way the stock is trading, it may reach the target in next few months. On Friday, the stock closed at $103.33

Disclosure: I own shares and options of Ambarella at the time of this writing.

Related Link: Barron’s article on Ambarella

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