Semiconductors · NASDAQ
Current Price
$201.69
Intrinsic Value
Use the calculator below to estimate
Run a PE ratio stock valuation on Arm Holdings plc American Depositary Shares with auto-filled earnings data, adjustable target PE, and instant fair value estimate.
Open PE Calculator for ARMArm Holdings plc architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers rely on to develop products. It offers microprocessors, systems intellectual property (IPs), graphics processing units, physical IP and associated systems IPs, software, tools, and other related services. Its products are used in various markets, such as automotive, computing infrastructure, consumer technologies, and Internet of things. The company operates in the United States, the People's Republic of China, Taiwan, South Korea, and internationally. The company was founded in 1990 and is headquartered in Cambridge, the United Kingdom. Arm Holdings plc operates as a subsidiary of Kronos II LLC.
Earnings Yield
0.37%
ROE (TTM)
11.0%
Based on trailing twelve-month data, ARM has earnings per share of N/A and trades at a PE ratio of N/A. These are key inputs for stock valuation using the PE ratio method.
The trailing twelve-month PE ratio of ARM reflects how much investors pay per dollar of Arm Holdings plc American Depositary Shares's earnings. This metric is most useful when compared to Semiconductors peers and the company's own historical range.
Whether ARM is overvalued depends on comparing its PE ratio to Semiconductors peers, historical averages, and growth expectations. A PE above the sector average may indicate overvaluation, but high-growth companies often command premium multiples. Consider pairing PE analysis with a DCF model for a more complete picture.
To value Arm Holdings plc American Depositary Shares using PE: (1) Compare the current PE against the Semiconductors median to assess relative pricing, (2) check the PEG ratio to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
The PEG ratio divides the PE ratio by the expected earnings growth rate, providing a growth-adjusted valuation metric. A PEG below 1.0 may indicate undervaluation relative to growth, while above 2.0 may suggest overvaluation. PEG is most reliable for companies with stable, predictable earnings growth.
PE ratio gives a quick relative read — how ARM is priced versus Semiconductors peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
