Ambarella Inc. (NASDAQ: AMBA) has taken the market by storm, not only in 2015 but over the past 52-weeks as well. Shares are up nearly 100% year to date and over 220% in the past year. However, one analyst does not see the run as over yet. In fact, Canaccord Genuity sees continued growth in Ambarella across a few segments, which can further drive shares.

Canaccord Genuity reiterated a Buy rating and raised its price target to $120 from $115. This is just $3 off of the highest price target out of all analysts.

The brokerage firm believes that Ambarella video encode/compression processors are differentiated across three primary metrics: video quality, compression efficiency and lowest power.

For example, Ambarella’s management estimates 30% to 40% lower power and 30% to 50% compression efficiency, which leads on the closest competition. Canaccord Genuity believes these metrics translate into an 18 to 24 month competitive lead that is sustainable in the medium term, driving not only share gains and new customer wins, but design stickiness of current sole-sourced sockets.

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Separately, the firm sees the drone market roughly doubling each of the next couple years, including non-flying, but camera-capable drones. With trends moving quickly to include drone-specific cameras, versus only mounting a sports camera such as GoPro, Ambarella drone camera revenue is expected to grow to near $30 million in fiscal 2016 and $50 million in fiscal 2017 from roughly $6 million in fiscal 2015 given close partnership with market leader DJI.

Canaccord Genuity analyst Matthew Ramsay said:

We maintain our belief Ambarella’s portfolio of highly differentiated application-specific video encode, compression, and analytics processors positions the company for strong sales and earnings growth as HD and UltraHD video capture and compression become increasingly important across several consumer and enterprise markets. In fact, with continued strong growth of core sports and enterprise security cameras and new growth of home security, wearable, automotive, and drone cameras (which we analyze in this note in our newly introduced detailed revenue estimates by end market), we believe growth will remain strong through fiscal 17 and upside is likely to our Street-high revenue estimates. Finally, we believe Ambarella’s investments in video analytics, including the VisLab acquisition for automotive markets, will prove undervalued long term.

As a result, the firm lowered conservative fiscal 2016 and 2017 estimates to include VisLab acquisition costs. Canaccord Genuity lowered its EPS estimates to $3.20 and $4.00, from $3.30 and $4.15, for 2016 and 2017 respectively. However, the brokerage firm applauded this acquisition and believes that Ambarella is setting the technological groundwork to emerge as a leading auto camera chip supplier.

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Shares of Ambarella were up 3.6% at $102.69 Tuesday morning. The stock has a consensus analyst price target of $104.82 and a 52-week trading range of $27.40 to $128.06.

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