Wolfe Research analyst Chris Caso has reiterated their neutral stance on ARM stock, giving a Hold rating on January 22.
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Chris Caso has given his Hold rating due to a combination of factors including ARM Holdings’ current valuation and market dynamics. The company has showcased strong growth potential, particularly with licensing revenues exceeding expectations and showing promise for continued expansion. Yet, despite these positive elements, the stock’s valuation appears to be high, trading at approximately 71 times the expected earnings per share for 2026.
Moreover, while licensing is thriving, the royalty revenue has not met street expectations, partly due to challenging market conditions and inventory adjustments. Although there is optimism that royalty income will eventually align with robust licensing growth, the current valuation remains a significant concern, making it difficult to justify a more aggressive rating. These considerations collectively contribute to the Hold recommendation.
According to TipRanks, Caso is a 5-star analyst with an average return of 23.4% and a 59.70% success rate. Caso covers the Technology sector, focusing on stocks such as Micron, Advanced Micro Devices, and Intel.
In another report released on January 22, Susquehanna also maintained a Hold rating on the stock with a $140.00 price target.