The link between GoPro and chip maker Ambarella has caught the eyes of both bulls on bears. Earlier this week, Ambarella posted a positive earnings report that analysts at JMP Securities used to reiterate their bullish stance on GoPro.

GoPro Inc Stock Will Double: JMP

GoPro shares tumble

However, the bears have apparently begun to worry about just how much Ambarella’s earnings report says about GoPro’s sales. This week it was reported that Ambarella is also supplying chips for a camera made by Chinese manufacturer Xiaomi to compete with GoPro’s line of action cameras.

As of this writing, shares of GoPro were down by 3.72% to $41.41 per share. Shares of Ambarella also dipped today, falling as much as 4.25% to $64.62 per share after rallying Wednesday in the wake of the company’s earnings report.

What bulls like about GoPro stock

Analysts at JMP Securities have reiterated their Outperform rating and $105 per share price target on GoPro. The firm expects to see a 48% growth rate in the current quarter and 43% growth rate for the June quarter. JMP analysts bumped up their earnings per share estimate from $1.45 to $1.50 per share for the full fiscal year.

One of the most common arguments for GoPro is the company’s plans to become a content company in addition to hardware. Whether or not those plans will be successful remains to be seen, but Morgan Stanley analyst James Faucette is buying the possibility.

He continues to rate GoPro at Equal-weight with a $57 per share price target and has said multiple times that the key to the company’s success is the development of video editing software and becoming a leader in that area. He calls this “content enablement” and said his conversations with management about their research and development efforts have suggested a possible move in this direction.

What bears don’t like about GoPro

On the other hand though, competition within the action camera market is heating up, and Xiaomi’s entry is clearly concerning some investors. However, the GoPro name (for now anyway) remains synonymous with action cameras.

Also for all the comparisons between GoPro and Apple, this is one area in which a valid argument could be made that Xiaomi’s low-price offering probably won’t take a huge chunk of GoPro’s sales because consumers trust GoPro’s brand.

One thing that should rightfully give investors pause is GoPro’s current valuation. The company has a market capitalization of about $5.33 billion, and its price to earnings ratio is in the neighborhood of 47 times diluted earnings. USA Today markets reporter Matt Krantz called GoPro stock one for “thrill seekers,” just as the company’s cameras are for thrill seekers as well.