Ambarella, Inc. (NASDAQ:AMBA) shares were trading more than 9% higher Wednesday afternoon. Analysts at KeyBanc Capital Markets upgraded the company to Overweight from Sector Weight, with a $185 price target on the shares.

The brokerage mentioned three main reasons for the upgrade:

(1) Multiple favorable tailwinds related to the adoption of CV within the security and automotive end markets with a limited competitive landscape with the HiSilicon ban, while the brokerage has increasing confidence in front-facing ADAS adoption,

(2) with its highly differentiated CV/AI assets and IP, and adoption in auto tech, the brokerage believes the company is one of the most attractive M&A targets in semiconductors,

(3) inflection in revenues and operating leverage gives the brokerage increased confidence in the company's ability to sustain R&D investment and its ability to compete.