131.57 USD
-0.96 (-0.72%)
131.71 USD
+0.14 (+0.11%)
Overall ARM gets a fundamental rating of 7 out of 10. We evaluated ARM against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the health and profitability get an excellent rating, making ARM a very profitable company, without any liquidiy or solvency issues. ARM is valued quite expensively, but it does show have an excellent growth rating. These ratings would make ARM suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
ARM had positive earnings in the past year.
ARM had a positive operating cash flow in the past year.
In the past 5 years ARM has always been profitable.
Each year in the past 5 years ARM had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 8.55%, ARM is doing good in the industry, outperforming 79.46% of the companies in the same industry.
With a decent Return On Equity value of 11.21%, ARM is doing good in the industry, outperforming 75.89% of the companies in the same industry.
The Return On Invested Capital of ARM (7.78%) is better than 76.79% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ARM is below the industry average of 10.84%.
The last Return On Invested Capital (7.78%) for ARM is above the 3 year average (6.46%), which is a sign of increasing profitability.
| 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 an excellent Profit Margin value of 18.81%, ARM belongs to the best of the industry, outperforming 82.14% of the companies in the same industry.
In the last couple of years the Profit Margin of ARM has remained more or less at the same level.
ARM has a Operating Margin of 19.54%. This is amongst the best in the industry. ARM outperforms 80.36% of its industry peers.
ARM's Operating Margin has declined in the last couple of years.
ARM's Gross Margin of 97.39% is amongst the best of the industry. ARM outperforms 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.
ARM has more shares outstanding than it did 1 year ago.
Compared to 1 year ago, ARM has a worse debt to assets ratio.
2.2 Solvency
ARM has an Altman-Z score of 38.17. This indicates that ARM is financially healthy and has little risk of bankruptcy at the moment.
ARM's Altman-Z score of 38.17 is amongst the best of the industry. ARM outperforms 93.75% of its industry peers.
ARM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.02 | ||
| Altman-Z | 38.17 |
ROIC/WACC0.67
WACC11.59%
2.3 Liquidity
ARM has a Current Ratio of 5.59. This indicates that ARM is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 5.59, ARM is doing good in the industry, outperforming 77.68% of the companies in the same industry.
A Quick Ratio of 5.59 indicates that ARM has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 5.59, ARM belongs to the top of the industry, outperforming 84.82% of the companies in the same industry.
| 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.
The Earnings Per Share has been growing by 12.27% on average over the past years. This is quite good.
The Revenue has grown by 24.81% in the past year. This is a very strong growth!
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
ARM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.58% yearly.
Based on estimates for the next years, ARM will show a very strong growth in Revenue. The Revenue will grow by 23.75% on average per year.
EPS Next Y4.79%
EPS Next 2Y18.13%
EPS Next 3Y19.3%
EPS Next 5Y19.58%
Revenue Next Year19.17%
Revenue Next 2Y20.29%
Revenue Next 3Y19.81%
Revenue Next 5Y23.75%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
ARM is valuated quite expensively with a Price/Earnings ratio of 78.32.
ARM's Price/Earnings ratio is in line with the industry average.
ARM's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.45.
With a Price/Forward Earnings ratio of 57.49, ARM can be considered very expensive at the moment.
The rest of the industry has a similar Price/Forward Earnings ratio as ARM.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.46, ARM is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 78.32 | ||
| Fwd PE | 57.49 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ARM.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ARM is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 122.47 | ||
| EV/EBITDA | 126.18 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ARM does not grow enough to justify the current Price/Earnings ratio.
ARM has a very decent profitability rating, which may justify a higher PE ratio.
ARM's earnings are expected to grow with 19.30% in the coming years. This may justify a more expensive valuation.
PEG (NY)16.34
PEG (5Y)N/A
EPS Next 2Y18.13%
EPS Next 3Y19.3%
5. Dividend
5.1 Amount
No dividends for ARM!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
131.57
-0.96 (-0.72%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners8.62%
Inst Owner Change-8.33%
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap139.37B
Revenue(TTM)4.41B
Net Income(TTM)830.00M
Analysts74
Price Target169.85 (29.09%)
Short Float %9.92%
Short Ratio2.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)9.96%
PT rev (3m)10.21%
EPS NQ rev (1m)13.86%
EPS NQ rev (3m)11.12%
EPS NY rev (1m)0%
EPS NY rev (3m)0.11%
Revenue NQ rev (1m)10.12%
Revenue NQ rev (3m)9.33%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.23%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 78.32 | ||
| Fwd PE | 57.49 | ||
| P/S | 31.59 | ||
| P/FCF | 122.47 | ||
| P/OCF | 88.21 | ||
| P/B | 18.82 | ||
| P/tB | 25.17 | ||
| EV/EBITDA | 126.18 |
EPS(TTM)1.68
EY1.28%
EPS(NY)2.29
Fwd EY1.74%
FCF(TTM)1.07
FCFY0.82%
OCF(TTM)1.49
OCFY1.13%
SpS4.17
BVpS6.99
TBVpS5.23
PEG (NY)16.34
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 | 38.17 |
F-Score8
WACC11.59%
ROIC/WACC0.67
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 Y4.79%
EPS Next 2Y18.13%
EPS Next 3Y19.3%
EPS Next 5Y19.58%
Revenue 1Y (TTM)24.81%
Revenue growth 3Y14.02%
Revenue growth 5YN/A
Sales Q2Q%34.48%
Revenue Next Year19.17%
Revenue Next 2Y20.29%
Revenue Next 3Y19.81%
Revenue Next 5Y23.75%
EBIT growth 1Y111.28%
EBIT growth 3Y6.91%
EBIT growth 5YN/A
EBIT Next Year24.3%
EBIT Next 3Y28.9%
EBIT Next 5Y26.58%
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 78.32 and the Price/Book (PB) ratio is 18.82.