Analyzing Ambarella (NASDAQ:AMBA) and Semiconductor Manufacturing International (OTCMKTS:SMICY)

Ambarella (NASDAQ:AMBA) and Semiconductor Manufacturing International (OTCMKTS:SMICY) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.

Analyst Ratings

This is a summary of recent ratings and price targets for Ambarella and Semiconductor Manufacturing International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ambarella	1	4	7	0	2.50
Semiconductor Manufacturing International	0	0	0	0	N/A

Ambarella presently has a consensus price target of $69.75, indicating a potential upside of 26.43%. Given Ambarella’s higher probable upside, equities analysts clearly believe Ambarella is more favorable than Semiconductor Manufacturing International.

Volatility and Risk

Ambarella has a beta of 1.63, suggesting that its stock price is 63% more volatile than the S&P 500. Comparatively, Semiconductor Manufacturing International has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500.

Earnings and Valuation

This table compares Ambarella and Semiconductor Manufacturing International’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ambarella	$226.47 million	9.99	-$169.42 million	($4.26)	-12.95
Semiconductor Manufacturing International	$3.12 billion	5.18	$234.68 million	$0.21	66.67

Semiconductor Manufacturing International has higher revenue and earnings than Ambarella. Ambarella is trading at a lower price-to-earnings ratio than Semiconductor Manufacturing International, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ambarella and Semiconductor Manufacturing International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ambarella	-78.36%	-24.86%	-21.45%
Semiconductor Manufacturing International	14.53%	4.00%	2.62%

Institutional & Insider Ownership

82.1% of Ambarella shares are owned by institutional investors. Comparatively, 0.0% of Semiconductor Manufacturing International shares are owned by institutional investors. 5.7% of Ambarella shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Semiconductor Manufacturing International beats Ambarella on 7 of the 13 factors compared between the two stocks.

About Ambarella

Ambarella, Inc. develops semiconductor solutions that enable high-definition (HD) and ultra HD compression, image signal processing, and artificial intelligence processing worldwide. The company's system-on-a-chip designs integrated HD video processing, image processing, artificial intelligence computer vision algorithms, audio processing, and system functions onto a single chip for delivering video and image quality, differentiated functionality, and low power consumption. Its solutions are used in automotive cameras, such as automotive video recorders, electronic mirrors, front advanced driver assistance system camera, cabin monitoring system and driver monitoring system camera, and central domain controllers for autonomous vehicle; enterprise and public class, and home security camera; and robotics and industrial application, including identification/authentication cameras, robotic products, and sensing cameras, as well as cameras for the enterprise, home, public spaces, and consumer leisure comprising wearable body cameras, sports action cameras, social media cameras, drones for capturing aerial video or photographs, video conferencing, and virtual reality applications. The company sells its solutions to original design manufacturers and original equipment manufacturers through its direct sales force and distributors. Ambarella, Inc. was incorporated in 2004 and is headquartered in Santa Clara, California.

About Semiconductor Manufacturing International

Semiconductor Manufacturing International Corporation, an investment holding company, engages in the computer-aided design, manufacture, testing, packaging, and trading of integrated circuits (IC) and other semiconductor services. It is also involved in wafer manufacturing, wafer probing and bumping, technology development, design service, mask manufacturing, and assembly and final testing of integrated circuits; and sale of self-manufactured products. In addition, the company designs and manufactures semiconductor masks; and offers marketing related services. It operates in North America, China, Hong Kong, and Eurasia. The company serves integrated device manufacturers, fabless semiconductor companies, and system companies. Semiconductor Manufacturing International Corporation was founded in 2000 and is headquartered in Shanghai, the People's Republic of China.