111.55 USD
-0.47 (-0.42%)
111.35 USD
-0.2 (-0.18%)
We assign a fundamental rating of 7 out of 10 to ARM. ARM was compared to 113 industry peers in the Semiconductors & Semiconductor Equipment industry. ARM scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ARM is valued quite expensively, but it does show have an excellent growth rating. These ratings could make ARM a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
In the past year ARM was profitable.
In the past year ARM had a positive cash flow from operations.
ARM had positive earnings in each of the past 5 years.
ARM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ARM's Return On Assets of 8.55% is fine compared to the rest of the industry. ARM outperforms 77.88% of its industry peers.
With a decent Return On Equity value of 11.21%, ARM is doing good in the industry, outperforming 74.34% of the companies in the same industry.
With a decent Return On Invested Capital value of 7.78%, ARM is doing good in the industry, outperforming 76.11% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ARM is below the industry average of 10.77%.
The 3 year average ROIC (6.46%) for ARM is below the current ROIC(7.78%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.55% | ||
| ROE | 11.21% | ||
| ROIC | 7.78% |
ROA(3y)6.79%
ROA(5y)N/A
ROE(3y)10.1%
ROE(5y)N/A
ROIC(3y)6.46%
ROIC(5y)N/A
1.3 Margins
With a decent Profit Margin value of 18.81%, ARM is doing good in the industry, outperforming 79.65% of the companies in the same industry.
ARM's Profit Margin has been stable in the last couple of years.
The Operating Margin of ARM (19.54%) is better than 78.76% of its industry peers.
ARM's Operating Margin has declined in the last couple of years.
The Gross Margin of ARM (97.39%) is better than 100.00% of its industry peers.
In the last couple of years the Gross Margin of ARM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.54% | ||
| PM (TTM) | 18.81% | ||
| GM | 97.39% |
OM growth 3Y-6.24%
OM growth 5YN/A
PM growth 3Y-0.9%
PM growth 5YN/A
GM growth 3Y0.64%
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ARM is destroying value.
Compared to 1 year ago, ARM has more shares outstanding
The debt/assets ratio for ARM is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 32.64 indicates that ARM is not in any danger for bankruptcy at the moment.
The Altman-Z score of ARM (32.64) is better than 92.92% of its industry peers.
There is no outstanding debt for ARM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.02 | ||
| Altman-Z | 32.64 |
ROIC/WACC0.62
WACC12.54%
2.3 Liquidity
A Current Ratio of 5.59 indicates that ARM has no problem at all paying its short term obligations.
ARM's Current ratio of 5.59 is fine compared to the rest of the industry. ARM outperforms 78.76% of its industry peers.
ARM has a Quick Ratio of 5.59. This indicates that ARM is financially healthy and has no problem in meeting its short term obligations.
ARM's Quick ratio of 5.59 is amongst the best of the industry. ARM outperforms 84.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 5.59 | ||
| Quick Ratio | 5.59 |
3. Growth
3.1 Past
ARM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 24.44%, which is quite impressive.
ARM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.27% yearly.
ARM shows a strong growth in Revenue. In the last year, the Revenue has grown by 24.81%.
The Revenue has been growing by 14.02% on average over the past years. This is quite good.
EPS 1Y (TTM)24.44%
EPS 3Y12.27%
EPS 5YN/A
EPS Q2Q%30%
Revenue 1Y (TTM)24.81%
Revenue growth 3Y14.02%
Revenue growth 5YN/A
Sales Q2Q%34.48%
3.2 Future
The Earnings Per Share is expected to grow by 20.00% on average over the next years. This is quite good.
ARM is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 24.28% yearly.
EPS Next Y7.26%
EPS Next 2Y19.38%
EPS Next 3Y22.1%
EPS Next 5Y20%
Revenue Next Year22.06%
Revenue Next 2Y21.97%
Revenue Next 3Y20.87%
Revenue Next 5Y24.28%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ARM is valuated quite expensively with a Price/Earnings ratio of 66.40.
The rest of the industry has a similar Price/Earnings ratio as ARM.
ARM is valuated expensively when we compare the Price/Earnings ratio to 26.59, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 47.72 indicates a quite expensive valuation of ARM.
ARM's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of ARM to the average of the S&P500 Index (24.03), we can say ARM is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 66.4 | ||
| Fwd PE | 47.72 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ARM.
ARM's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 103.83 | ||
| EV/EBITDA | 106.41 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ARM has a very decent profitability rating, which may justify a higher PE ratio.
ARM's earnings are expected to grow with 22.10% in the coming years. This may justify a more expensive valuation.
PEG (NY)9.15
PEG (5Y)N/A
EPS Next 2Y19.38%
EPS Next 3Y22.1%
5. Dividend
5.1 Amount
No dividends for ARM!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
111.55
-0.47 (-0.42%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners7.58%
Inst Owner Change-8.36%
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap118.16B
Revenue(TTM)4.41B
Net Income(TTM)830.00M
Analysts74
Price TargetN/A
Short Float %10.41%
Short Ratio3.1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.96%
Min EPS beat(2)-1.76%
Max EPS beat(2)15.67%
EPS beat(4)3
Avg EPS beat(4)7.8%
Min EPS beat(4)-1.76%
Max EPS beat(4)15.67%
EPS beat(8)7
Avg EPS beat(8)11.81%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)2.28%
Min Revenue beat(2)-1.31%
Max Revenue beat(2)5.88%
Revenue beat(4)2
Avg Revenue beat(4)1.78%
Min Revenue beat(4)-1.31%
Max Revenue beat(4)5.88%
Revenue beat(8)6
Avg Revenue beat(8)3.18%
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)7.66%
PT rev (3m)10.09%
EPS NQ rev (1m)0.68%
EPS NQ rev (3m)14.63%
EPS NY rev (1m)2.35%
EPS NY rev (3m)2.46%
Revenue NQ rev (1m)0.41%
Revenue NQ rev (3m)10.76%
Revenue NY rev (1m)2.43%
Revenue NY rev (3m)2.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 66.4 | ||
| Fwd PE | 47.72 | ||
| P/S | 26.78 | ||
| P/FCF | 103.83 | ||
| P/OCF | 74.79 | ||
| P/B | 15.95 | ||
| P/tB | 21.34 | ||
| EV/EBITDA | 106.41 |
EPS(TTM)1.68
EY1.51%
EPS(NY)2.34
Fwd EY2.1%
FCF(TTM)1.07
FCFY0.96%
OCF(TTM)1.49
OCFY1.34%
SpS4.17
BVpS6.99
TBVpS5.23
PEG (NY)9.15
PEG (5Y)N/A
Graham Number16.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.55% | ||
| ROE | 11.21% | ||
| ROCE | 9.85% | ||
| ROIC | 7.78% | ||
| ROICexc | 12.4% | ||
| ROICexgc | 18.8% | ||
| OM | 19.54% | ||
| PM (TTM) | 18.81% | ||
| GM | 97.39% | ||
| FCFM | 25.79% |
ROA(3y)6.79%
ROA(5y)N/A
ROE(3y)10.1%
ROE(5y)N/A
ROIC(3y)6.46%
ROIC(5y)N/A
ROICexc(3y)10.54%
ROICexc(5y)N/A
ROICexgc(3y)19.88%
ROICexgc(5y)N/A
ROCE(3y)8.18%
ROCE(5y)N/A
ROICexgc growth 3Y-16.23%
ROICexgc growth 5YN/A
ROICexc growth 3Y-6.35%
ROICexc growth 5YN/A
OM growth 3Y-6.24%
OM growth 5YN/A
PM growth 3Y-0.9%
PM growth 5YN/A
GM growth 3Y0.64%
GM growth 5YN/A
F-Score8
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.02 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 209.48% | ||
| Cap/Sales | 10.02% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 147.25% | ||
| Profit Quality | 137.11% | ||
| Current Ratio | 5.59 | ||
| Quick Ratio | 5.59 | ||
| Altman-Z | 32.64 |
F-Score8
WACC12.54%
ROIC/WACC0.62
Cap/Depr(3y)91.19%
Cap/Depr(5y)79.24%
Cap/Sales(3y)4.62%
Cap/Sales(5y)4.95%
Profit Quality(3y)150.9%
Profit Quality(5y)159.55%
High Growth Momentum
Growth
EPS 1Y (TTM)24.44%
EPS 3Y12.27%
EPS 5YN/A
EPS Q2Q%30%
EPS Next Y7.26%
EPS Next 2Y19.38%
EPS Next 3Y22.1%
EPS Next 5Y20%
Revenue 1Y (TTM)24.81%
Revenue growth 3Y14.02%
Revenue growth 5YN/A
Sales Q2Q%34.48%
Revenue Next Year22.06%
Revenue Next 2Y21.97%
Revenue Next 3Y20.87%
Revenue Next 5Y24.28%
EBIT growth 1Y111.28%
EBIT growth 3Y6.91%
EBIT growth 5YN/A
EBIT Next Year28.45%
EBIT Next 3Y28.08%
EBIT Next 5Y26.7%
FCF growth 1Y-83.32%
FCF growth 3Y-25.56%
FCF growth 5YN/A
OCF growth 1Y-63.58%
OCF growth 3Y-4.65%
OCF growth 5YN/A
ARM HOLDINGS PLC-ADR / ARM FAQ
What is the fundamental rating for ARM stock?
ChartMill assigns a fundamental rating of 7 / 10 to ARM.
What is the valuation status of ARM HOLDINGS PLC-ADR (ARM) stock?
ChartMill assigns a valuation rating of 2 / 10 to ARM HOLDINGS PLC-ADR (ARM). This can be considered as Overvalued.
What is the profitability of ARM stock?
ARM HOLDINGS PLC-ADR (ARM) has a profitability rating of 7 / 10.
What are the PE and PB ratios of ARM HOLDINGS PLC-ADR (ARM) stock?
The Price/Earnings (PE) ratio for ARM HOLDINGS PLC-ADR (ARM) is 66.4 and the Price/Book (PB) ratio is 15.95.