Ambarella (NASDAQ:AMBA) and NVIDIA (NASDAQ:NVDA) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, valuation and institutional ownership.
This is a breakdown of current ratings and recommmendations for Ambarella and NVIDIA, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ambarella presently has a consensus price target of $212.08, suggesting a potential upside of 5.85%. NVIDIA has a consensus price target of $332.23, suggesting a potential upside of 3.42%. Given Ambarella’s higher possible upside, equities analysts plainly believe Ambarella is more favorable than NVIDIA.
Earnings and Valuation
This table compares Ambarella and NVIDIA’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ambarella||$222.99 million||32.94||-$59.79 million||($1.34)||-149.51|
|NVIDIA||$16.68 billion||48.16||$4.33 billion||$2.81||114.53|
NVIDIA has higher revenue and earnings than Ambarella. Ambarella is trading at a lower price-to-earnings ratio than NVIDIA, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
73.6% of Ambarella shares are held by institutional investors. Comparatively, 19.2% of NVIDIA shares are held by institutional investors. 5.6% of Ambarella shares are held by insiders. Comparatively, 4.5% of NVIDIA shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This table compares Ambarella and NVIDIA’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
Ambarella has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, NVIDIA has a beta of 1.46, indicating that its share price is 46% more volatile than the S&P 500.
NVIDIA beats Ambarella on 12 of the 15 factors compared between the two stocks.
Ambarella, Inc. engages in the development and sale of video compression, image processing, and computer vision solutions. It offers processors and software that cater to end markets including security cameras, automotive cameras, industrial and robotic applications, and consumer applications. The company was founded by Feng Ming Wang and Leslie D. Kohn on January 15, 2004 and is headquartered in Santa Clara, CA.
NVIDIA Corp. engages in the design and manufacture of computer graphics processors, chipsets, and related multimedia software. It operates through the following segments: Graphics Processing Unit (GPU), Tegra Processor, and All Other. The GPU segment comprises of product brands, which aims specialized markets including GeForce for gamers; Quadro for designers; Tesla and DGX for AI data scientists and big data researchers; and GRID for cloud-based visual computing users. The Tegra Processor segment integrates an entire computer onto a single chip, and incorporates GPUs and multi-core CPUs to drive supercomputing for autonomous robots, drones, and cars, as well as for consoles and mobile gaming and entertainment devices. The All Other segment refers to the stock-based compensation expense, corporate infrastructure and support costs, acquisition-related costs, legal settlement costs, and other non-recurring charges. The company was founded by Jen Hsun Huang, Chris A. Malachowsky, and Curtis R. Priem in January 1993 and is headquartered in Santa Clara, CA.
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