Stifel raises Ambarella stock price target to $100, maintains buy

On Thursday, Stifel analysts increased the price target for Ambarella (NASDAQ:AMBA) shares to $100 from the previous $95, while maintaining a Buy rating. Currently trading at $70.36, the stock has shown significant momentum with a 43.6% gain over the past six months, according to InvestingPro data. The adjustment follows Ambarella’s fourth quarter fiscal year 2025 results, which showcased revenue of $84.0 million, marking a 1.6% quarter-over-quarter increase and exceeding Stifel’s estimate by 7.7%.

Ambarella’s revenue for the quarter surpassed Stifel’s projection of $78.0 million, primarily driven by growth in the Internet of Things (IoT) segment, which compensated for a sequential decline in the Automotive sector. According to Stifel’s analysis, Ambarella’s product mix at the close of FY25 consisted of approximately 70% IoT and 30% Automotive. The company maintains strong financial flexibility with a current ratio of 2.84 and minimal debt, as highlighted in InvestingPro’s comprehensive analysis.

The company also reported a non-GAAP (NG) earnings per share (EPS) of $0.11, which was notably $0.13 higher than Stifel’s estimate of a $0.02 loss per share. For the first quarter of fiscal year 2026, Ambarella provided a revenue midpoint guidance of $84.0 million, a figure that is consistent quarter-over-quarter but 13.4% higher than Stifel’s earlier estimate of $74.1 million. This guidance reflects the continued momentum within the company’s Computer Vision (CV) product family.

Stifel’s analysts expressed confidence in Ambarella’s performance, stating that the company once again exceeded expectations. They believe Ambarella’s execution on its CV product family growth pipeline will continue to offer a robust and defensible trajectory for significant secular growth in FY26. The new 12-month price target of $100 represents a 10.9x calendar year 2026 estimated enterprise value to sales multiple. InvestingPro analysis reveals that 10 analysts have recently revised their earnings estimates upward, though the company’s current valuation suggests it may be trading above its Fair Value.

In other recent news, Ambarella reported its fourth-quarter fiscal year 2025 earnings, which exceeded expectations with an earnings per share (EPS) of $0.11 against a forecast of -$0.02, and revenue of $84 million surpassing the expected $78.03 million. The company anticipates mid- to high-teen percentage revenue growth for fiscal year 2026, with significant contributions from its CV5 and CV7 product lines. Needham analysts raised Ambarella’s stock price target to $110, maintaining a Buy rating, citing strong quarterly results and an optimistic fiscal outlook. Rosenblatt Securities also upheld a Buy rating with a steady price target of $100, highlighting the company’s sequential growth and successful product transition. Meanwhile, KeyBanc Capital Markets maintained a Sector Weight rating, acknowledging the company’s strong performance but opting for a neutral stance until further evidence of success with Ambarella’s CV3 and GenAI technologies. Ambarella’s management remains cautious about the second half of fiscal year 2026 due to potential tariff impacts, despite a positive growth trajectory. The company’s focus on expanding its Edge AI technology and new product launches continues to drive growth, with a strategic emphasis on the automotive and IoT markets.

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