Business

Arm Stock Is Dropping Again. Why Its Owner Is Happy.

Support Independent Journalism with a donation (Paypal, BTC, USDT, ETH)
Spread the love

Arm supplies core technology to companies that include Apple and Nvidia.

Michael M. Santiago/Getty Images

Arm Holdings stock dropped again Tuesday, falling below its opening price at last week’s initial public offering. While investors cooled toward the chip-design firm, majority owner SoftBank Group was counting its gains. 

Arm (ticker: ARM) slid 4.9% to $55.18. After reaching more than $65 a share in initial trading after its IPO last Thursday, the stock is now below its opening price of $56.10. 

Early judgments from analysts have taken a skeptical tone toward Arm’s valuation. The brokerage Redburn Atlantic initiated coverage on the stock with a Neutral rating and a price target of $50.

“To recommend Arm at current valuations, we need higher conviction in
a multi-year earnings acceleration from a weak FY23 [fiscal 2023] base,” Redburn’s Timm Schulze-Melander wrote.

That’s not much of a worry for SoftBank (9984.Japan), which said Tuesday that it would receive $5.12 billion in proceeds from the 10% stake it sold in Arm as part of the offer. Arm’s stock price is still ahead of its initial pricing of $51 a share, and SoftBank has said it intends to remain the long-term owner of the company.

The offer proceeds will be a boost to SoftBank’s coffers for further investment, while the successful IPO of Arm is likely to improve sentiment around the possibility of further listings. SoftBank has recorded a series of hefty losses on its Vision Funds business, which holds the world’s largest venture-capital portfolio.

SoftBank doesn’t look to be wasting any time in making a new series of investments focusing on artificial-intelligence technology. The Japanese company is leading a $280 million funding round in U.S. location-mapping company Mapbox at a valuation of around $1.3 billion, the Financial Times reported Monday, citing people close to SoftBank.

Write to Adam Clark at [email protected]

EMEA Tribune is not involved in this news article, it is taken from our partners and or from the News Agencies. Copyright and Credit go to the News Agencies, email [email protected]

Support Independent Journalism with a donation (Paypal, BTC, USDT, ETH)
Avatar

News Agencies

About Author

The latest news from the News Agencies

You may also like

exotic expansion llc best stock picking services
Business

Exotic Expansion LLC: Is it one of few Best Stock Picking Services?

Spread the loveExotic Expansion LLC: You may have wondered once in a life that if you had someone who can
investing in cryptocurrencies
Business

Are you investing in cryptocurrencies? 4 important points before you invest

Spread the loveInvesting in cryptocurrencies Driven by financial backers’ energy, the cryptographic money market as of late crossed the $3