ARM (NASDAQ:ARM) Stock Price Up 4.2% - Time to Buy?

Key Points

• ARM shares rose 4.2% to approximately $249 in Tuesday trading, though volume was substantially below the stock’s average daily level.
• Arm’s AI and data-center opportunities remain the key bullish case: quarterly revenue increased 22.4% year over year to $1.29 billion, while EPS exceeded analyst expectations.
• Valuation is the main concern. ARM trades at elevated earnings multiples, and analysts remain divided despite a “Moderate Buy” consensus rating and an average price target of $305.72.

Shares of Arm Holdings PLC Sponsored ADR (NASDAQ:ARM - Get Free Report) traded up 4.2% on Tuesday . The company traded as high as $251.22 and last traded at $249.0770. Approximately 677,046 shares traded hands during mid-day trading, a decline of 91% from the average daily volume of 7,790,556 shares. The stock had previously closed at $239.01.

Key ARM News

Here are the key news stories impacting ARM this week:

• Positive Sentiment: Arm’s AI growth opportunity remains the central bullish argument. The company’s processor architecture is used in many hyperscalers’ custom CPUs, allowing it to collect licensing fees and per-chip royalties as data-center and AI spending expands. Its fiscal first-quarter revenue rose 22% year over year to $1.29 billion, while earnings exceeded analyst expectations. Prediction: Arm Could Be the Picks-and-Shovels Winner of the AI Boom
• Positive Sentiment: The launch and expansion of Arm’s Neoverse CSS N4 and AGI CPU initiatives strengthen its positioning in cloud, edge-computing and AI workloads. Management is also promoting Arm’s role in “physical AI,” including robotics and autonomous systems, while ZaiNar joined the Arm Total Design program as a founding physical-AI partner. Arm expands AI chip push with Neoverse CSS N4 and AGI CPU ZaiNar Joins Arm Total Design For Physical AI As Founding Location Partner
• Neutral Sentiment: Analysts and commentators remain divided over whether the recent AI-related selloff has made ARM attractive. Supporters view Arm as a “picks-and-shovels” beneficiary of AI, while others argue the stock needs a much lower entry price. Is Arm Holdings (ARM) Cheap After The AI Stock Pullback?
• Negative Sentiment: ARM’s elevated valuation remains the main risk. Reports cite a forward multiple near 120 times earnings, leaving little room for execution or growth disappointments. A broader Nasdaq and semiconductor selloff recently pressured the shares, and the company still has meaningful exposure to smartphones, which generated about 43% of fiscal 2026 royalty revenue. Arm stock falls 7% as AI selloff, valuation risks hit chip designer Arm Stock Is Down More Than 40%. Here’s Why I’m Staying on the Sidelines.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently commented on the company. Susquehanna lifted their price objective on ARM from $300.00 to $320.00 and gave the stock a "positive" rating in a research note on Tuesday, July 21st. Wells Fargo & Company reduced their target price on ARM from $350.00 to $280.00 and set an "overweight" rating on the stock in a report on Thursday, July 30th. Mizuho boosted their target price on ARM from $425.00 to $500.00 and gave the stock an "outperform" rating in a research report on Monday, June 8th. Needham & Company LLC reaffirmed a "buy" rating and issued a $255.00 price target on shares of ARM in a research note on Thursday, July 30th. Finally, Piper Sandler initiated coverage on ARM in a research note on Wednesday, September 9th. They issued an "overweight" rating and a $320.00 price target for the company. One research analyst has rated the stock with a Strong Buy rating, eighteen have given a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the company's stock. Based on data from MarketBeat.com, ARM currently has a consensus rating of "Moderate Buy" and a consensus price target of $305.72.

ARM Trading Up 1.3%

The company has a 50 day moving average of $264.17 and a 200 day moving average of $244.38. The firm has a market cap of $258.70 billion, a price-to-earnings ratio of 250.28, a P/E/G ratio of 7.85 and a beta of 3.89.

ARM (NASDAQ:ARM - Get Free Report) last posted its earnings results 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 firm had revenue of $1.29 billion during the quarter, compared to analysts' expectations of $1.26 billion. ARM had a return on equity of 12.24% and a net margin of 20.25%.The company's revenue was up 22.4% on a year-over-year basis. During the same period in the previous year, the firm earned $0.35 earnings per share. Equities analysts forecast that Arm Holdings PLC Sponsored ADR will post 1.15 EPS for the current fiscal year.

Insider Activity

In related news, CFO Jason Child sold 10,400 shares of the stock in a transaction that occurred on Thursday, August 27th. The stock was sold at an average price of $255.33, for a total transaction of $2,655,432.00. Following the completion of the sale, the chief financial officer directly owned 163,832 shares of the company's stock, valued at approximately $41,831,224.56. This represents a 5.97% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently made changes to their positions in the stock. GAMMA Investing LLC boosted its holdings in shares of ARM by 18.7% in the 2nd quarter. GAMMA Investing LLC now owns 406 shares of the company's stock valued at $144,000 after purchasing an additional 64 shares in the last quarter. Allworth Financial LP raised its holdings in shares of ARM by 2.9% during the 2nd quarter. Allworth Financial LP now owns 2,269 shares of the company's stock worth $804,000 after buying an additional 65 shares in the last quarter. MCF Advisors LLC raised its holdings in shares of ARM by 11.7% during the 2nd quarter. MCF Advisors LLC now owns 764 shares of the company's stock worth $271,000 after buying an additional 80 shares in the last quarter. AdvisorNet Financial Inc lifted its position in shares of ARM by 6.2% during the 1st quarter. AdvisorNet Financial Inc now owns 1,681 shares of the company's stock worth $254,000 after buying an additional 98 shares during the last quarter. Finally, TD Waterhouse Canada Inc. lifted its position in shares of ARM by 0.5% during the 2nd quarter. TD Waterhouse Canada Inc. now owns 18,674 shares of the company's stock worth $6,309,000 after buying an additional 102 shares during the last quarter. Institutional investors and hedge funds own 7.53% of the company's stock.

About ARM

Arm Holdings plc is a semiconductor and software intellectual property company headquartered in Cambridge, England. Rather than manufacturing chips, Arm develops processor architectures and technology designs that it licenses to semiconductor companies, device manufacturers and other technology businesses for use in their own products.

Arm's portfolio includes central processing unit (CPU) architectures and processor cores, graphics processing units (GPUs), systems IP, interconnect technology, security solutions and related software and development tools.

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