4 big analyst cuts: Ambarella takes a plunge

By Davit Kirakosyan

Here is your Pro Recap of the biggest analyst cuts you may have missed since yesterday: downgrades at Ambarella, Hibbett Sports, NeoGames, and Rain Therapeutics.

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Ambarella downgraded following disappointing guidance

KeyBanc downgraded Ambarella (NASDAQ:AMBA) to Sector Weight from Overweight following Q1 earnings yesterday.

Shares were down more than 16% in recent trading today after the chipmaker reported a weaker-than-expected outlook for Q2.

KeyBanc mentioned several reasons for the downgrade, including (1) limited design wins in non-China auto despite significant investments in CV, (2) the Continental/Bosch wins have only resulted in limited progress, and (3) the pivot to AI inferencing is concerning as it may distract from achieving greater success in auto with CV3.

Hibbett Sports downgraded at BofA Securities

BofA Securities downgraded Hibbett Sports (NASDAQ:HIBB) to Underperform from Buy and cut its price target to $35.00 from $85.00, citing a "significant slowdown" after the company cut its full-year forecast last week.

Management now expects a full-year profit of $7-$7.75, down from the prior $9.5-$10 forecast. Comparable sales are expected to fall low-single digits.

Despite its cautious outlook for the near future in terms of consumer behavior, BofA Securities are confident that the company is in a strong position to sustain growth and expand its market share in the long run.

Hibbett shares were down nearly 5% in recent trading.

2 more downgrades

Macquarie downgraded Neogames (NASDAQ:NGMS) to Neutral from Outperform. The company reported its Q1 results earlier this month, missing revenue expectations.

Roth/MKM downgraded Rain Therapeutics (NASDAQ:RAIN) to Neutral from Buy and cut its price target to $1.20 from $2.00 after the company provided an update on milademetan clinical programs.

The company will suspend enrollment in the ongoing milademetan Phase 2 MANTRA-2 basket trial and has terminated plans for initiation of the Phase 1/2 MANTRA-4 combination trial.

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