Latest news with #ArmHoldings
Globe and Mail
19 hours ago
- Business
- Globe and Mail
ARM Holdings' Valuation Running Ahead of Fundamentals Amid AI Hype
Arm Holdings plc ARM has attracted immense investor attention, thanks to its perceived position at the heart of the AI revolution, given that its architecture underpins a vast number of chips used in everything from smartphones to emerging AI devices. However, its current valuation warrants a closer look. ARM trades at nearly 85X forward 12-month earnings, a significant premium to the broader semiconductor industry average of 33X. While the company's strategic relevance is undeniable, the elevated multiple reflects expectations that may take time to materialize in financial results. Arm-based chips are shipped at an impressive scale, over 30 billion units annually, yet the company generates relatively modest revenues per chip. In fiscal 2024, Arm reported $4 billion in total revenue, with $2 billion derived from royalties. This places the average royalty rate at about 6.5 cents per chip, while overall per-chip revenue stands at approximately 13 cents. Arm's strength lies in its broad ecosystem and power-efficient designs, which position it well for long-term trends in AI, IoT, and mobile computing. However, its current revenue model, driven primarily by low per-unit royalties, indicates a need for more substantial near-term monetization. Investors may want to consider locking in gains while the stock remains priced for perfection. Further upside may depend on a clearer path to stronger revenue and earnings growth. Beyond ARM: NVIDIA and Qualcomm are Better Valued While ARM's valuation may prompt caution, investors looking for semiconductor exposure with clearer financial traction might consider NVIDIA NVDA and Qualcomm QCOM. NVIDIA, with a forward 12-month P/E of 32, continues to dominate the AI accelerator space, with strong revenue and earnings growth, driven by surging demand for its GPUs. The company's leadership in AI infrastructure makes NVIDIA a favorite among growth-oriented investors. Meanwhile, Qualcomm, trading at just 13x forward earnings, offers a more diversified chip portfolio spanning smartphones, automotive, and IoT. Its solid royalty business and increasing footprint in AI-powered edge devices position Qualcomm for steady expansion. Both NVIDIA and Qualcomm have demonstrated the ability to monetize their innovations more effectively than ARM, making them compelling alternatives. ARM's Price Performance, Estimates The stock has surged 28% year to date, significantly outperforming the industry 's 11% rally. The Zacks Consensus Estimate for ARM's earnings has been on the decline over the past 60 days. ARM stock currently carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Picks Stock Most Likely to "At Least Double" Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren't winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%. See Our Top Stock to Double (Plus 4 Runners Up) >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report QUALCOMM Incorporated (QCOM): Free Stock Analysis Report ARM Holdings PLC Sponsored ADR (ARM): Free Stock Analysis Report This article originally published on Zacks Investment Research (
Yahoo
17-06-2025
- Business
- Yahoo
Why Arm Holdings Stock Soared Higher Today
Late last week, Meta Platforms announced it was buying a 49% stake in Scale AI for nearly $15 billion. That deal shows Meta's commitment to improving its position in the AI space. Meta will be the first buyer of Arm's first in-house-designed AI chips. 10 stocks we like better than Arm Holdings › Shares of Arm Holdings (NASDAQ: ARM) jumped by 4.8% on Monday during a session in which the S&P 500 rose 0.9% and the Nasdaq Composite rose 1.5%. Frustrated with his company's progress in the artificial intelligence (AI) space, CEO Mark Zuckerberg has accelerated Meta Platform's already lavish spending on the technology -- and the social media giant's latest AI gambit also gave a lift to Arm Holdings' shares. Meta announced Thursday that it was acquiring a 49% stake in Scale AI, a company at the forefront of the technology's development, for nearly $15 billion. Investors in Arm were pleased to hear it because that company -- which until recently has not made its own chips, but rather licensed its technology to other chipmakers -- is launching its own line of AI-capable chips as early as this summer, and Meta will be the first customer for them. The news that Meta has committed to further increasing its AI spending is being viewed as a sign that Arm's relationship with Meta could become even more lucrative than was originally thought. Arm will keep licensing its cores and other technology to other chipmakers, but this pivot into designing its own chips too could help accelerate its earnings and revenue growth, especially given the customers it has lined up. However, it is also facing accusations in court and complaints filed with numerous regulators by one of its most important customers, Qualcomm, which alleges that it breached its license agreements and is engaging in anticompetitive behaviors. Arm could be forced to alter its business practices and may face steep fines if those allegations are found to be true. Given the uncertainty around how these cases could play out and the stock's lofty price-to-earnings ratio of more than 180, I would avoid Arm shares for now. Before you buy stock in Arm Holdings, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Arm Holdings wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $870,207!* Now, it's worth noting Stock Advisor's total average return is 988% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms and Qualcomm. The Motley Fool has a disclosure policy. Why Arm Holdings Stock Soared Higher Today was originally published by The Motley Fool
Yahoo
14-06-2025
- Business
- Yahoo
Arm Holdings (ARM) Gets a ‘Hold' from Benchmark—But Its AI Momentum Is Hard to Ignore
Arm Holdings plc (NASDAQ:) is one of the . On June 12, Benchmark analyst Cody Acree reiterated a 'Hold' rating on the stock. The rating reaffirmation follows a virtual conference call with the company's Senior Director of Investor Relations, Alexis Waadt. Expressing optimism regarding Arm's strong fundamental performance drivers, the firm highlighted Arm's impressive 96.98% gross margin and 23.94% year-over-year revenue growth. The firm particularly noted Arm's globally expanding licensing opportunities, robust position in the mobile market, as well as recent growth drivers in AI PCs, data centers, and more. The company also boasts diverse revenue streams and strategic partnerships, and holds the flexibility to navigate market challenges and leverage upcoming opportunities in the AI landscape. Analysts on Wall Street currently have a consensus 'Buy' rating on the stock. The average price target of $147 implies a 5.7% upside; however, the Street-high target of $180 implies an upside of 29.4%. Arm Holdings plc (NASDAQ:ARM) is a semiconductor and software design company that designs and manufactures semiconductor technology and other related products. While we acknowledge the potential of ARM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and Disclosure: None. 擷取數據時發生錯誤 登入存取你的投資組合 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤
Bloomberg
12-06-2025
- Automotive
- Bloomberg
Arm CEO Sides With Nvidia Against US Export Limits on China
Arm Holdings Plc Chief Executive Officer Rene Haas said Thursday that US export controls on China threaten to slow overall technological advances and are ultimately bad for consumers and companies, aligning himself with Nvidia Corp. Chief Executive Officer Jensen Huang and others looking to ease tensions between Washington and Beijing. 'If you narrow access to to technology and you force other ecosystems to grow up, it's not good,' Haas said Thursday in an interview with Bloomberg at the Founders Forum Global conference in Oxford. 'It makes the pie smaller, if you will. And frankly, it's not very good for consumers.' He also noted that Arm's footprint in China is 'quite significant.'
CNBC
11-06-2025
- Business
- CNBC
Lightning Round: 'Wait and see situation' with Papa John's, says Jim Cramer
'Mad Money' host Jim Cramer weighs in on stocks including: Joby Aviation, Arm Holdings, Kura Oncology, and Papa John's.
