ARM (NASDAQ:ARM) Stock Falls 6.8% – Should You Sell?

Arm Holdings PLC Sponsored ADR (NASDAQ:ARM)’s stock price fell 6.8% on Wednesday. The company traded as low as $237.52 and last traded at $238.01. 6,551,070 shares were traded during mid-day trading, a decline of 14% from the average session volume of 7,615,090 shares. The stock had previously closed at $255.39.

ARM News Summary

Here are the key news stories impacting ARM this week:

• Positive Sentiment: Arm’s annualized contract value increased 13% to $1.73 billion, indicating continued licensing momentum ahead of its fiscal second-quarter results. Can ARM’s 13% Contract Value Growth Sustain Momentum in Q2?
• Positive Sentiment: The company continues expanding beyond smartphones into AI data centers, while its architecture remains dominant in mobile devices and is used in more than 99% of smartphones. This supports the long-term growth narrative for Arm’s royalty and licensing businesses. The Next AI Stock Wall Street Is Starting to Pay Attention To
• Positive Sentiment: Microsoft’s addition of native Python support for Windows on Arm PCs could improve software compatibility and adoption of Arm-based computers, strengthening the platform’s broader ecosystem. Microsoft Brings Native Python Support to Windows on Arm PCs

Analysts Set New Price Targets

A number of research firms recently issued reports on ARM. Morgan Stanley raised their price objective on shares of ARM from $202.00 to $212.00 and gave the stock an “equal weight” rating in a report on Thursday, July 30th. Weiss Ratings reiterated a “hold (c)” rating on shares of ARM in a research note on Thursday. Jefferies Financial Group reissued a “buy” rating and set a $320.00 target price on shares of ARM in a research report on Monday, July 20th. Royal Bank Of Canada decreased their price target on shares of ARM from $475.00 to $340.00 and set an “outperform” rating for the company in a research note on Thursday, July 30th. Finally, Guggenheim reaffirmed a “buy” rating and issued a $255.00 price target on shares of ARM in a report on Thursday, July 30th. One analyst has rated the stock with a Strong Buy rating, eighteen have given a Buy rating, seven have given a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, ARM currently has an average rating of “Moderate Buy” and a consensus price target of $303.32.

ARM Trading Down 6.5%

The stock has a fifty day moving average of $268.36 and a two-hundred day moving average of $269.61. The company has a market capitalization of $244.57 billion, a PE ratio of 235.96, a PEG ratio of 7.06 and a beta of 3.78.

ARM (NASDAQ:ARM) last announced its quarterly earnings data on Thursday, July 30th. The company reported $0.45 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.40 by $0.05. The company had revenue of $1.29 billion during the quarter, compared to analysts’ expectations of $1.26 billion. ARM had a net margin of 20.25% and a return on equity of 12.24%. The firm’s revenue was up 22.4% on a year-over-year basis. During the same quarter in the prior year, the company earned $0.35 EPS. Equities analysts forecast that Arm Holdings PLC Sponsored ADR will post 1.15 EPS for the current year.

Insider Transactions at ARM

In related news, CFO Jason Child sold 10,400 shares of the firm’s stock in a transaction that occurred on Monday, September 21st. The stock was sold at an average price of $300.00, for a total transaction of $3,120,000.00. Following the transaction, the chief financial officer directly owned 153,442 shares in the company, valued at $46,032,600. This trade represents a 6.35% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Institutional Investors Weigh In On ARM

A number of large investors have recently added to or reduced their stakes in ARM. Syntax Research Inc. purchased a new stake in shares of ARM during the first quarter worth about $30,000. Evelyn Partners Investment Management Services Ltd bought a new stake in ARM during the 1st quarter valued at approximately $30,000. Allied Private Wealth LLC bought a new stake in ARM during the 2nd quarter valued at approximately $71,000. CX Institutional purchased a new position in shares of ARM during the 3rd quarter worth approximately $58,000. Finally, Cassaday & Co Wealth Management LLC purchased a new position in shares of ARM during the 1st quarter worth approximately $40,000. Institutional investors own 7.53% of the company’s stock.

About ARM

Arm Holdings plc (NASDAQ: ARM) is a semiconductor and software design company that develops intellectual property used to create energy-efficient computing products. Arm does not generally manufacture chips; instead, it licenses processor architectures, CPU cores, graphics technologies and related system IP to semiconductor companies and original equipment manufacturers, which incorporate them into their own products.

The company’s offerings include the Cortex family of CPUs for mobile, consumer, automotive and embedded applications; Neoverse platforms for cloud and data-center infrastructure; Mali graphics processing units; and Ethos neural processing units designed for artificial intelligence and machine-learning workloads.