Arm Holdings Lockup Period Expires, SoftBank Remains Tight-Lipped On Future Share Plans

Arm Holdings Plc’s ARM stock has dramatically increased since its September debut, driven by the booming demand for semiconductors utilized in artificial intelligence computing. 

This surge has prompted speculation about potential insider sales following the expiration of a six-month lockup period on Tuesday. 

Public offerings often include such a lockup to restrict insiders from selling their shares immediately, limiting the available stock for trading, Bloomberg reports. 

Also Read: Samsung and Arm’s Latest AI Chip Collaboration: A New Era for Mobile Computing

Arm’s valuation, backed by SoftBank Group, has reached more than 33 times its projected sales, making it one of the market’s most highly valued stocks.

SoftBank, holding a 90% stake in Arm and significantly benefiting from the stock’s rise, has remained vague about its plans for its shares, emphasizing instead Arm’s pivotal role within its portfolio. 

Despite the lockup expiration, analysts like Vijay Rakesh of Evercore ISI remain bullish on Arm’s prospects, citing its promising long-term roadmap. However, opinions among analysts vary, with some cautioning about potential volatility and a possible 20% decrease from current stock levels.

Analysts have praised Arm as the dominant force in the mobile CPU market, holding more than 99% market share. They believe there’s room for Arm to further increase its revenue.

They have also flagged Arm’s accelerating custom silicon roadmap and foundry collaboration with Intel Corp INTC.

Analysts expect AI-driven royalty growth & strategic licensing to boost earnings.

Price Actions: ARM shares were up 0.6% at $127.60 at last check Tuesday.

Also Read: Nvidia Bolsters AI Leadership with Investment in Arm Holdings, Eyes Future Growth in Semiconductor Industry

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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