Arm Holdings Plc's
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.
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
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.