ARM (NASDAQ:ARM) Shares Down 2.2% - Here's Why

Key Points

• ARM Holdings' stock dropped 2.2% to $168.16 during mid-day trading, with trading volume significantly exceeding the daily average.
• Analysts have largely favorable views, with Mizuho raising its price target to $180.00 and multiple firms assigning "outperform" ratings.
• During the last quarter, ARM reported a 12.1% revenue increase year-over-year, with earnings per share of $0.35, slightly above expectations.

ARM Holdings PLC Sponsored ADR (NASDAQ:ARM - Get Free Report) dropped 2.2% during mid-day trading on Tuesday . The company traded as low as $167.54 and last traded at $168.16. Approximately 12,742,240 shares were traded during mid-day trading, an increase of 136% from the average daily volume of 5,394,772 shares. The stock had previously closed at $171.94.

Wall Street Analyst Weigh In

ARM has been the subject of a number of analyst reports. Mizuho increased their price objective on shares of ARM from $160.00 to $180.00 and gave the stock an "outperform" rating in a research note on Thursday, July 3rd. BNP Paribas Exane upgraded ARM from a "neutral" rating to an "outperform" rating and set a $210.00 price target for the company in a research note on Wednesday, July 16th. TD Cowen increased their target price on ARM from $155.00 to $175.00 and gave the stock a "buy" rating in a research report on Thursday, July 31st. Seaport Res Ptn upgraded ARM to a "strong-buy" rating in a research report on Monday, August 11th. Finally, Wells Fargo & Company increased their target price on ARM from $145.00 to $175.00 and gave the stock an "overweight" rating in a research report on Monday, July 21st. One analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating, seven have assigned a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, ARM presently has a consensus rating of "Moderate Buy" and a consensus price target of $167.43.

ARM Price Performance

The stock has a market cap of $177.66 billion, a PE ratio of 254.79, a price-to-earnings-growth ratio of 10.10 and a beta of 4.10. The stock has a 50-day moving average price of $144.42 and a two-hundred day moving average price of $135.79.

ARM (NASDAQ:ARM - Get Free Report) last released its quarterly earnings results on Wednesday, July 30th. The company reported $0.35 earnings per share for the quarter, beating the consensus estimate of $0.34 by $0.01. The business had revenue of $1.05 billion during the quarter, compared to analysts' expectations of $1.06 billion. ARM had a return on equity of 15.56% and a net margin of 16.96%.The firm's revenue for the quarter was up 12.1% compared to the same quarter last year. During the same quarter last year, the business posted $0.40 EPS. Equities research analysts expect that ARM Holdings PLC Sponsored ADR will post 0.9 earnings per share for the current year.

Hedge Funds Weigh In On ARM

A number of institutional investors and hedge funds have recently made changes to their positions in ARM. Goldman Sachs Group Inc. boosted its holdings in shares of ARM by 59.3% in the 1st quarter. Goldman Sachs Group Inc. now owns 6,574,854 shares of the company's stock worth $702,129,000 after purchasing an additional 2,446,224 shares during the period. Sustainable Growth Advisers LP boosted its stake in ARM by 116.8% during the second quarter. Sustainable Growth Advisers LP now owns 3,457,220 shares of the company's stock worth $559,171,000 after buying an additional 1,862,626 shares during the period. Schroder Investment Management Group boosted its stake in ARM by 41.7% during the second quarter. Schroder Investment Management Group now owns 4,745,957 shares of the company's stock worth $767,611,000 after buying an additional 1,396,684 shares during the period. Invesco Ltd. boosted its stake in ARM by 139.9% during the second quarter. Invesco Ltd. now owns 1,381,906 shares of the company's stock worth $223,509,000 after buying an additional 805,886 shares during the period. Finally, Robeco Institutional Asset Management B.V. boosted its stake in ARM by 3,853.4% during the second quarter. Robeco Institutional Asset Management B.V. now owns 520,465 shares of the company's stock worth $84,180,000 after buying an additional 507,300 shares during the period. 7.53% of the stock is owned by hedge funds and other institutional investors.

About ARM

Arm Holdings Plc engages in the licensing, marketing, research, and development of microprocessors, systems IP, graphics processing units, physical IP and associated systems IP, software, and tools. It operates through the following geographical segments: United Kingdom, United States, and Other Countries.

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