This Analyst Reiterates Growth Potential In Arm, Boosts Price Target By 30%

Zinger Key Points
  • Analyst raises ARM Holdings' price target to $110 due to generative AI momentum and Asia trip insights.
  • ARM poised for enhanced licensing and royalty dynamics, boosted by AI focus, v9 architecture, and SoC deployment.

Rosenblatt analyst Hans Mosesmann maintained ARM Holdings Plc ARM with a Buy and raised the price target from $85 to $110.

The analyst revised his 12-month price target for ARM upward to $110 from $85 as generative AI class design and licensing momentum have shifted aggressively based on his recent Asia trip and SoC IP checks. 

The implications are for ARM to enjoy incrementally positive licensing and royalty dynamics in quantity and quality (ASPs). 

Themes driving ARM's multi-year roadmap include the v9 architecture shift, AI moving faster to the edge where discrete GPUs are sub-optimal, PC and server ARM CPU share gains, and the new ARM CSS program to lower SoC deployment cost (and increase dollar content). 

Also Read: What's Next for Arm Holdings? Over 70 Engineers Gone in China as Global Strategy Shifts

Given Arm's strong growth outlook, the analyst noted a premium mid-40s P/E multiple is appropriate, applied to FY26 EPS earnings power of ~$2.50 (versus his estimate of $1.85), resulting in his 12-month price target of $110 from his previous $85 mark.

The analyst projected Q3 revenue and EPS of $760 million and $0.25.

ARM Price Action: Arm Holdings shares are trading higher by 0.82% at $72.89 on the last check Tuesday.

Photo via Wikimedia Commons

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: NewsPrice TargetReiterationAnalyst RatingsTechTrading IdeasBriefsExpert Ideas
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!