ARM (NASDAQ:ARM) Shares Down 2.6% – Should You Sell?

Arm Holdings PLC Sponsored ADR (NASDAQ:ARM)’s share price fell 2.6% during mid-day trading on Tuesday. The company traded as low as $175.78 and last traded at $181.49. 4,129,602 shares traded hands during trading, a decline of 45% from the average session volume of 7,454,891 shares. The stock had previously closed at $186.30.

More ARM News

Here are the key news stories impacting ARM this week:

• Positive Sentiment: Arm expanded its processor lineup with new Cortex-M42 processors, adding to its product portfolio and potentially broadening its reach in embedded and connected-device markets. Arm Expands Its Portfolio with New Arm Cortex-M42 Processors
• Positive Sentiment: A report on Liontrust Investment Partners’ Global Innovation Fund says the fund bought ARM after its sell-off, signaling renewed investor interest. This is a sentiment indicator rather than evidence of a broad institutional shift. Arm Holdings plc (ARM) Was Bought Back After a Sharp Sell-Off
• Positive Sentiment: One analysis highlights Arm’s custom CPU growth and potential demand from agentic AI, arguing that longer-term earnings estimates could be too conservative. The article also cautions that the shares are not obviously cheap. Is Arm Stock a Buy on the Dip as Agentic AI Opportunity Emerges?
• Neutral Sentiment: Arm CEO Rene Haas warned that resistance to U.S. AI data centers could push projects and jobs overseas. The comments underscore policy risk to the AI infrastructure buildout, though they do not indicate a specific change in Arm’s business or results. Arm CEO Warns US AI Data Center Pushback Could Send Jobs Abroad
• Negative Sentiment: Despite quarterly revenue growth of 27% to a record $1.44 billion and an adjusted EPS beat, ARM fell about 13% on Nov. 5. The coverage points to investor concerns about the post-earnings outlook and valuation, alongside a broad semiconductor sell-off. ARM Just Dropped 13% After Earnings
• Negative Sentiment: Another article flags SoftBank Group’s ¥1.12 trillion ($7 billion) loss as a concern for Arm. That is an indirect potential overhang tied to Arm’s major shareholder, not a reported deterioration in Arm’s own operating results. SoftBank’s $7 Billion Loss Is Bad News for Arm

Analyst Upgrades and Downgrades

A number of research analysts recently issued reports on the stock. Piper Sandler reiterated an “overweight” rating and set a $270.00 target price (down from $320.00) on shares of ARM in a research report on Thursday, November 5th. Raymond James Financial reiterated an “outperform” rating and set a $166.00 price objective on shares of ARM in a report on Tuesday, August 25th. KeyCorp increased their price objective on shares of ARM from $300.00 to $430.00 and gave the stock an “overweight” rating in a research report on Tuesday, July 14th. New Street Research upgraded ARM from a “neutral” rating to a “buy” rating and set a $260.00 target price for the company in a research note on Thursday, July 30th. Finally, Bank of America reaffirmed a “neutral” rating and issued a $335.00 target price (up from $245.00) on shares of ARM in a research report on Thursday, July 30th. Nineteen equities research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the stock. According to MarketBeat, ARM currently has an average rating of “Moderate Buy” and a consensus target price of $291.72.

ARM Stock Performance

The stock has a market cap of $193.85 billion, a P/E ratio of 208.61, a price-to-earnings-growth ratio of 5.60 and a beta of 3.93. The company’s 50 day moving average price is $251.72 and its 200-day moving average price is $230.29.

ARM (NASDAQ:ARM) last released its quarterly earnings results on Wednesday, November 4th. The company reported $0.52 earnings per share for the quarter, beating analysts’ consensus estimates of $0.48 by $0.04. ARM had a net margin of 17.13% and a return on equity of 11.86%. The company had revenue of $1.44 billion for the quarter, compared to analyst estimates of $1.38 billion. During the same period last year, the firm earned $0.39 earnings per share. The firm’s revenue was up 27.1% on a year-over-year basis. On average, analysts forecast that Arm Holdings PLC Sponsored ADR will post 1.17 earnings per share for the current fiscal year.

Insider Activity

In related news, CFO Jason Child sold 10,400 shares of the stock in a transaction that occurred on Monday, September 21st. The stock was sold at an average price of $300.00, for a total transaction of $3,120,000.00. Following the completion of the sale, the chief financial officer directly owned 153,442 shares of the company’s stock, valued at approximately $46,032,600. This trade represents a 6.35% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Institutional Inflows and Outflows

Institutional investors have recently bought and sold shares of the business. Global Retirement Partners LLC raised its stake in shares of ARM by 19.3% during the 3rd quarter. Global Retirement Partners LLC now owns 3,019 shares of the company’s stock worth $874,000 after purchasing an additional 488 shares during the period. Teachers Retirement System of The State of Kentucky bought a new stake in ARM in the third quarter worth about $10,462,000. HighTower Advisors LLC raised its position in ARM by 2.0% in the third quarter. HighTower Advisors LLC now owns 96,247 shares of the company’s stock worth $27,879,000 after acquiring an additional 1,859 shares during the period. Hantz Financial Services Inc. boosted its stake in ARM by 93.8% in the third quarter. Hantz Financial Services Inc. now owns 12,774 shares of the company’s stock valued at $3,700,000 after acquiring an additional 6,181 shares during the last quarter. Finally, Moors & Cabot Inc. boosted its stake in ARM by 13.0% in the third quarter. Moors & Cabot Inc. now owns 2,667 shares of the company’s stock valued at $773,000 after acquiring an additional 306 shares during the last quarter. Institutional investors own 7.53% of the company’s stock.

About ARM

Arm Holdings plc designs and licenses semiconductor technology, including processor architectures and related intellectual property. Rather than manufacturing chips, the company licenses its designs and collects royalties on products that use them. Arm’s offerings include Cortex CPUs, Mali graphics processors, Neoverse infrastructure platforms and other technology for applications ranging from smartphones and consumer electronics to automotive systems, the Internet of Things and cloud computing.