I recently made a starter position in Amba, and have been observing as it finds a new low.
I had read quite a bit about Amba prior to investing in it, and it doesn’t seem any of that has changed. Today it has continued to drop,as the market and other stocks have increased.
Thus, it seems I am learning about the effect of perhaps short sellers attacking the stock.
I am curious how a more experienced investor than I would approach this situation… How does one determine how long to sit and hold, versus selling? Or if one is truly convinced with the stock in the long term, when does one consider selling at a loss and purchasing again at a possibly lower price?
I have lots to learn I know, but need to start from somewhere.
I believe there are 2 overhangs weighing on AMBA. First, sentiment is down on GPRO which as I recall are about 30% of AMBA’s revenues. GPRO reports on October 28th after the close. IF they report well, that should serve as a near term catalyst for AMBA. Longer term there is the specter of QCOM getting into the drone arena. This is an area that AMBA hopes will spur future growth. While it seems that AMBA’s products have an edge in quality, there is a large segment of the drone market where good may be “good enough” especially at a good price point likely offered by QCOM. This is a longer term concern. QCOM’s products don’t come to market until 2016. I think a good report by GPRO could trigger a nice run into the end of the year.