On Thursday, May 22, Mizuho Securities reaffirmed an “Outperform” rating on Arm Holdings plc (NASDAQ:ARM) with a price target of $160.

The decision came after investor meetings with the company’s Vice President of Investor Relations, Jeff Kvaal. According to Mizuho analysts, Arm Holdings plc (NASDAQ:ARM) is expected to grow steadily. The analysts forecast the company to grow its licensing at a rate of 7-10% and royalties at a rate of 20% each year for the next 2-3 years.Mizuho Maintains Positive Outlook on Arm Holdings (ARM)

A technician in a pristine lab, focused on designing a new semiconductor chip.

Arm Holdings plc (NASDAQ:ARM) is expected to gain market share in the server CPU market through its products like Graviton, Axion, Cobalt, and Grace. The company had a 15% market share in 2024 and is now aiming for a 50% market share. Additionally, Arm Holdings plc (NASDAQ:ARM) is also increasing its share in the PC market. The company is estimated to have reached about 14% in Q1 2025, up from 11% in Q4 2024.

The company’s Stargate project, which is set to be introduced in the second half of 2026, is a big opportunity for the company. It will potentially incorporate a custom ARM Accelerator, which could help Arm Holdings plc (NASDAQ:ARM) significantly expand its total addressable market. Mizuho analysts believe that ARM is positioned well to benefit from the ongoing expansion of cloud server data centers and innovation in AI.

Arm Holdings plc (NASDAQ:ARM) is a British semiconductor and software design company that develops and licenses advanced IP solutions to leading technology companies.

While we acknowledge the potential of ARM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ARM and that has a 100x upside potential, check out our report about the cheapest AI stock.

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