Posted 4/9/2024, 12:16:36 PM
Arm Holdings Stock Soars on AI Hopes, But Morningstar Forecasts 56% Plunge
- Arm Holdings' stock has surged over 80% this year due to AI hype and increased royalty fees, but Morningstar predicts a 56% drop
- Morningstar believes the AI narrative is "ancillary" and has set a $57 price target based on 17% annual growth over 10 years
- Some experts are more optimistic - Mizuho raised its target to $160 (24% upside) forecasting 25% annual revenue growth from 2025
- EMJ Capital and Jim Cramer also highlighted Arm as an attractive Nvidia-adjacent AI stock, despite the recent run-up
- The debate over Arm's prospects and whether AI hype is overblown continues, but the stock was up 0.39% in premarket Tuesday