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Arm Holdings (ARM) is drawing fresh attention after unveiling its first proprietary Arm AGI CPU for data center and AI workloads, following a sector wide chip rally after Intel’s strong quarterly results and upbeat CPU demand signals.
See our latest analysis for Arm Holdings.
That broader enthusiasm around AI chips has fed directly into Arm’s move, with a 1-day share price return of 14.76% and a 7-day share price return of 40.83%. This has contributed to a 90-day share price return of 102.30% and a 1-year total shareholder return of 107.17%, suggesting momentum has been building rather than cooling.
If this AI fueled run has you looking beyond a single name, it could be a useful moment to widen your search with 38 AI infrastructure stocks
With Arm now trading at US$234.81, above an average analyst price target of US$169.59 and with an intrinsic value estimate that sits far lower again, you have to ask whether there is still genuine upside here or if the market is already paying up for years of future growth.
According to the most widely followed narrative from user Goran_Damchevski, a fair value of $39.16 sits far below Arm’s last close at $234.81, putting today’s AI driven enthusiasm in stark contrast with that valuation view.
In Q2’25 ARM reported revenues of $844M, up 5% YoY. Sales were down 10% from Q1, as the company marked its first sequential drop after Q4’FY23.
The company made $3.5B in revenues over a 12-month period, and is up by 18% on a TTM basis. This is close to my revised 16% CAGR estimate, and I maintain my 2029 $7.3B revenue target for ARM.
Want to see how robust revenue assumptions, higher margins and a punchy future earnings multiple combine to justify that fair value? The narrative leans on a specific growth glide path, detailed profit conversion and a firm view on what investors might pay for those earnings down the line, without revealing every step in the model upfront.
Result: Fair Value of $39.16 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, if Arm keeps extending key partnerships or protects more IP than expected, those revenue streams could challenge a bearish valuation case.
Find out about the key risks to this Arm Holdings narrative.
After reviewing this, do you feel the story leans too cautious or too optimistic? Consider the data while it is still fresh and review the 1 key reward
If Arm has sharpened your interest, do not stop here. Use the screener to uncover other opportunities that match your goals before the market moves on.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include ARM.
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