We recently compiled a list of the 10 Mid-Cap Stocks Insiders Are Selling Recently. In this article, we are going to take a look at where Ambarella, Inc. (NASDAQ:AMBA) stands against the other feminist stocks. We previously covered 10 Mid-Cap Stocks Insiders Are Buying Recently.
Why should investors analyze insider trading activity? Insiders, or people in high positions within a company—such as executives and directors—can have crucial insights into the company’s strategic moves, plans, and initiatives. When, for example, a CEO invests their own capital in company stocks, it can indicate strong confidence in the company’s future results.
What does it mean when insiders are selling their shares? It doesn’t necessarily mean bad news for the stock. Sometimes, large shareholders just want to trim their holdings to more appropriate position sizes based on the risk/reward potential.
It is important to note that both insider selling and buying can be driven by various motives. Therefore, any insider trading activity should be analyzed within the broader context of the company’s fundamentals, industry trends, and overall market conditions. Many insider purchases don’t necessarily mean the company will be successful. That’s why due diligence before any investment is of the utmost importance. Investors should also take into account and carefully analyze underlying reasons for insider transactions. However, insider trading activity in combination with other relevant factors can offer valuable insights into a company’s capabilities, helping investors make more informed investment decisions.
To identify the 10 mid-cap stocks insiders are selling recently, we considered only stocks with a market capitalization of between $2 billion and $10 billion. We first used Insider Monkey’s insider trading stock screener and looked for stocks with at least two insiders buying over the last two months.
With each stock we note the number of recent insider sales and the company’s current market capitalization. But why is it important to follow insider activity? Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here)
A scientist in a lab coat and goggles operating a state-of-the-art semiconductor production line.
Ambarella, Inc. (NASDAQ:AMBA)
Number of Insiders Selling: 9
Market Capitalization: $3.279B
In the fourth spot on our list of mid-cap stocks insiders are selling recently is Ambarella, a semiconductor design company, concentrated on low-power, high-definition and Ultra HD video compression, image processing and computer vision processors.
Over the last two months, nine insiders, including CEO, CFO, and COO sold a total of around $2.31 million worth of the company’s shares at an average price of $75.35 per share. Currently, Ambarella shares are trading at $76.80 having gained 5.58% since the beginning of the year.
According to data from Stock Analysis, 12 analysts have an average “Buy” rating on the stock, with a price target of $84.17. Furthermore, on January 27th, Rosenblatt Securities reiterated a “Buy” rating on Ambarella stock with a price target of $100, writes Morningstar.
For the nine months ended October 31, 2024, the company disclosed revenue of $200.9 million, up 15% from the nine months ended October 31, 2023. For the same nine months of 2024 GAAP net loss amounts to $96.9 million or loss per diluted ordinary share of $2.36. This compared with GAAP net loss of $108.8 million or or loss per diluted ordinary share of $2.74 for the nine months ended October 31, 2023. For the fiscal year 2025, Ambarella expects revenue between $76 and $80 million.
Ambarella is one of the 10 Unstoppable Tech Stocks to Buy Right Now. Over the last 12 months, its shares gained 38.58%.
Overall AMBA ranks 4th on our list of the mid-cap stocks insiders are selling recently. While we acknowledge the potential of AMBA as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMBA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.