In a report released today, Janardan Menon from Jefferies maintained a Buy rating on ARM Holdings PLC ADR (ARM – Research Report), with a price target of $195.00.
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Janardan Menon has given his Buy rating due to a combination of factors related to the growth prospects and strategic positioning of ARM Holdings PLC ADR. The company is expected to see significant revenue growth, particularly in FY25, driven by a substantial increase in licensing and royalty revenue, buoyed by developments in AI-based chip technology and strategic license renewals.
Looking further ahead, the acceleration of royalty growth is anticipated in FY26 and FY27, supported by recovery in the IoT and networking sectors, as well as ARM’s expanding presence in cloud computing through major partnerships. Additionally, the company’s potential to benefit from the shift toward inferencing at the edge, with the rise of AI applications in everyday devices, positions it favorably. Despite the broader uncertainty in the semiconductor market, ARM is seen as a stable investment due to its robust growth outlook and strategic advancements, justifying the increased price target.