Assessing ARM's Fundamentals Before Making a Purchase

Shares of Semiconductors company Arm jumped 6.7% today. With many investors piling into ARM without a second thought, it may be a good idea to take a closer look at the stock. Here are some quick facts to get you started:

  • Arm has moved 97.9% over the last year, and the S&P 500 logged a change of 24.0%

  • Its trailing earnings per share (EPS) is $0.29

  • Arm has a trailing 12 month Price to Earnings (P/E) ratio of 463.1 while the S&P 500 average is 27.65

  • Its forward earnings per share (EPS) is $2.04 and its forward P/E ratio is 65.8

  • The company has a Price to Book (P/B) ratio of 26.39 in contrast to the S&P 500's average ratio of 4.59

  • Arm is part of the Technology sector, which has an average P/E ratio of 32.54 and an average P/B of 4.25

  • ARM has reported YOY quarterly earnings growth of 76556.5% and gross profit margins of 1.0%

  • The company has a free cash flow of $1.34 Billion, which refers to the total sum of all its inflows and outflows of cash over the last quarter

  • Arm Holdings plc architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers rely on to develop products. The company is involved in the licensing, marketing, research, and development of microprocessors, systems intellectual property (IPs), graphics processing units, physical IP and associated systems IPs, software, tools, and other related services. It also offers system IP products, including memory controller IP, interconnect IP, and other on-chip peripheral components; and compute platforms for a range of devices and applications. The company's products are used in various markets, such as automotive, computing infrastructure, consumer technologies, and Internet of things. It operates in the United States, the People's Republic of China, Taiwan, the Republic of Korea, and internationally. The company was founded in 1990 and is headquartered in Cambridge, the United Kingdom. Arm Holdings plc operates as a subsidiary of Kronos II LLC.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.