Ambarella, Inc. (AMBA) DCF Valuation
Why we don't show a single “fair value” for AMBA
Even the optimistic scenario of a conservative trailing-FCF model ($17.90) sits far below today's price — the market is paying for growth and durability beyond what this model structure captures. Off today's cash-flow base, no plausible growth rate bridges to the current price — the market is valuing normalized future cash flows, not the depressed base. The model scenarios below are shown for reference only.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 10.9%/yr | 12.5% | $12.83 |
| Base case | 13.9%/yr | 11.5% | $14.98 |
| Optimistic | 16.9%/yr | 10.5% | $17.90 |
Current Price
$62.13
Market-Implied Growth
—
Base-Case Model Value
$14.98
model output — not a price target
AMBA DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for AMBA (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $26.2M · 0.04B shares · net cash $191.0M
Estimated Fair Value
$19.53
-68.6% vs $62.13
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 13.9%/yr FCF growth and 10-year horizon fixed. Green = above today's $62.13; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $23.09 | $23.90 | $24.83 | $25.89 | $27.14 |
| 10.5% | $20.59 | $21.17 | $21.83 | $22.58 | $23.43 |
| 11.5% | $18.61 | $19.04 | $19.53 | $20.07 | $20.67 |
| 12.5% | $17.01 | $17.34 | $17.70 | $18.10 | $18.55 |
| 13.5% | $15.70 | $15.95 | $16.23 | $16.53 | $16.87 |
About Ambarella, Inc.
Ambarella, Inc. is a global semiconductor company specializing in advanced video processing technology. They develop chips that facilitate high-definition (HD) and ultra-HD (UHD) video compression, sophisticated image manipulation, and cutting-edge deep learning capabilities. Their core offering comprises highly integrated system-on-a-chip (SoC) designs. These single-chip solutions seamlessly combine HD video and image processing, artificial intelligence (AI) computer vision, audio processing, and various system functions, resulting in superior video and image clarity, distinct features, and efficient power usage. Ambarella's technology finds broad application across diverse markets. In the automotive sector, their chips power devices like vehicle dashcams, digital rearview mirrors, advanced driver-assistance systems (ADAS) cameras, interior and driver monitoring systems, and central domain controllers for self-driving vehicles. Beyond automotive, their solutions are crucial for professional and residential IP security cameras, various robotics and industrial applications (including identification, authentication, robotic products, and sensing), and a wide range of consumer products. The consumer segment encompasses wearable cameras, sports action cameras, social media devices, aerial drones, video conferencing equipment, and virtual reality systems. The company distributes its semiconductor solutions to original equipment manufacturers (OEMs) and original design manufacturers (ODMs) through a combination of its direct sales team and a network of distributors. Established in 2004, Ambarella, Inc. is headquartered in Santa Clara, California.
- Sector
- Technology
- Industry
- Semiconductors
- CEO
- Feng-Ming Wang