Loop Capital is optimistic about Arm Holdings’ future following the company’s recent earnings report. Analyst Ananda Baruah has increased his price target for the chipmaker, adding $15 to reach $195, signaling a potential 20% gain. He continues to uphold his buy rating for the stock. In the fiscal third quarter, Arm surpassed analysts’ forecasts in both revenue and earnings, although the company’s forward guidance was aligned with Wall Street predictions.
“ARM delivered impressive revenue and EPS growth in the December quarter,” Baruah mentioned in his note to clients, referring to earnings per share. “While March quarter guidance was steady, we expect a strong fiscal year 2026 narrative during the upcoming EPS call in April.”
Baruah highlighted that the demand for Arm’s computing systems has surged, thanks to the influence of artificial intelligence across various markets. The company mentioned upcoming major deals slated for the March quarter, driven by AI and computing subsystems. Nevertheless, Baruah cautioned about potential risks, including fluctuating customer demands and market weaknesses. Additionally, geopolitical tensions and ongoing legal issues with Qualcomm pose challenges for the UK-based company.
Despite some fluctuations, Arm’s stock ended the previous week up nearly 2%, although it dipped by about 1% in premarket trading on Monday. Since going public in 2023, Arm’s shares have risen over 31% this year. The sentiment among analysts remains mostly positive, with data from LSEG showing that 22 out of 38 analysts rate the stock as a buy or strong buy, while 13 others maintain a hold rating.
