On Friday, Morgan Stanley adjusted its outlook on Arm Holdings (NASDAQ:ARM), significantly increasing the stock's price target to $107 from the previous $55. The firm has maintained an Equalweight rating on the shares.
The revision follows observations of accelerated growth for Arm Holdings, particularly due to the adoption of AI design and the substantial effect of the ARMv9 architecture on royalties. This performance has exceeded initial expectations, even at this nascent stage of the product cycle.
In light of these developments, Morgan Stanley has revised its financial forecasts for Arm Holdings. The firm now projects higher sales and earnings for the fiscal year 2026, which has been a driving factor behind the new price target.
The ARMv9 architecture, which is the latest offering from Arm Holdings, is contributing to the company's financial uptick. The technology is playing a significant role in the growth trajectory of the company, as it begins to capture a larger share of the royalties market.
Morgan Stanley's updated price target of $107 reflects a doubling from the previous target of $55, signifying a positive outlook on the company's revenue and earnings potential in the coming years. This adjustment is rooted in the tangible growth indicators observed by the firm, particularly in the AI sector and the impact of ARMv9.
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