When shares of Ambarella (AMBA), a vendor of multimedia system-on-chip products, traded at about $13 earlier this year, I was bullish on the name, believing the shares were worth about $18 (~38% upside). Interestingly enough, the shares went on a pretty massive run and as of writing trade just shy of $31 per share. It is my belief that this stock, which was once a compelling long opportunity, now looks as though it could be a very compelling short opportunity from a risk/reward standpoint particularly as the massive run in the shares has had much more to do with hype and news-flow than with the underlying fundamentals.
Explaining This (Insane) Run
On Dec. 20, Ambarella announced that...
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