Targets: 12 month price -$60 / 18 month – $40
It seems like yesterday that Wall Street was frothing at the mouth over 3D printing stocks. These high flyers were not valued based on their financials but rather as a beneficiary of being anointed as “the new new”. Citron Research was critical of the space and published pieces on 3 of these bubble-levitated 3D printing stocks. It is 18 months later and most of them languish 80% off their highs.
So Wall Street has gone searching for another “new new” in the technology sector and has found one in Ambarella (NASDAQ:AMBA), whose parabolic frenzy has now launched it into a realm that can’t possibly be supported by reality. Citron points out how how far this niche chip designer's stock has separated from reality.
Obviously Lumber Liquidators (NYSE:LL) has an image problem, but Citron believes the selloff is largely overdone here.
The stock is off 60% from when its CEO first warned that an unfavorable 60 Minutes story was coming, but the reality is that the actions and advice of the California Air Resources Board ought to be considered and heeded by all investors.
So before piling on this short at these levels, perhaps a step back and rational reassessment would be a good idea.