ARM (NASDAQ: ARMH) is one of 98 publicly-traded companies in the “Semiconductors” industry, but how does it contrast to its competitors? We will compare ARM to related businesses based on the strength of its dividends, profitability, valuation, earnings, analyst recommendations, institutional ownership and risk.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for ARM and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ARM 0 0 1 0 3.00
ARM Competitors 949 4789 8762 365 2.57

As a group, “Semiconductors” companies have a potential upside of 13.17%. Given ARM’s competitors higher probable upside, analysts plainly believe ARM has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares ARM and its competitors revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
ARM N/A N/A 70.59
ARM Competitors $4.38 billion $573.56 million 40.35

ARM’s competitors have higher revenue and earnings than ARM. ARM is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares ARM and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ARM 33.10% 19.72% 16.87%
ARM Competitors -44.62% 1.23% 0.81%

Dividends

ARM pays an annual dividend of $0.34 per share and has a dividend yield of 0.5%. ARM pays out 35.4% of its earnings in the form of a dividend. As a group, “Semiconductors” companies pay a dividend yield of 1.6% and pay out 58.2% of their earnings in the form of a dividend.

Institutional and Insider Ownership

19.7% of ARM shares are owned by institutional investors. Comparatively, 66.3% of shares of all “Semiconductors” companies are owned by institutional investors. 3.0% of ARM shares are owned by insiders. Comparatively, 6.2% of shares of all “Semiconductors” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

ARM beats its competitors on 7 of the 13 factors compared.

About ARM

ARM Holdings plc (ARM) is a company engaged in designing a range of inter-related intellectual property (IP), including microprocessors, Physical IP, and supporting software and tools. Its product offering includes 16/32/64-bit reduced instruction set computing (RISC) microprocessors, data engines, graphics processors, digital libraries, embedded memories, peripherals, software and development tools, as well as analog functions and high-speed connectivity products. The Company licenses and sells its technology and products to international electronics companies, which in turn manufacture, market and sell microprocessors, application-specific integrated circuits (ASICs), application-specific standard processors (ASSPs) and microcontrollers (MCUs) based on ARM’s technology to systems companies for incorporation into a range of end products. Its principal geographic markets are Europe, the United States and Asia Pacific.

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