On Thursday, Bernstein raised his price target by Arm Holdings (NASDAQ:) to $92 from $72, although the investment firm maintained an Underperform rating on the company’s shares.
Reviewing Arm’s recent financial results, analysts noted that the company reported its second consecutive quarter of revenue, exceeding forecasts by $928 million. They stressed that it was primarily licensing revenue, and not royalties, that contributed to the higher-than-expected turnover.
Additionally, they believe financial projections for fiscal 2025 did not meet investor expectations for significant improvement and growth.
Additionally, analysts have expressed skepticism about Arm’s announcements regarding its plans to venture into the field of designing chips for artificial intelligence. Their concerns stem from the apparent dissatisfaction of demand in Arm’s primary market for computer system architectures (CSS) and the difficulties the company encountered in trying to diversify its service offerings during its time as a Softbank branch.
Bernstein’s report also mentions that Arm is showing positive trends in the server and laptop markets and that it is advancing its Computer System Architecture technology for use in automotive applications.
The analysts’ final assessment is that, despite the promising growth prospects, Arm’s market valuation appears quite high, especially when compared to that of other companies in the sector, which also appear to be highly valued.
Third Party Advertisement. This is not an offer or recommendation by Investing.com. Consult the information here or
remove ads
.
This article was produced and translated with the help of AI and was reviewed by an editor. For more details, please see our Terms and Conditions.
