There's a reason Nvidia really, really wanted to buy Arm.
From MarketWatch, March 20:
Arm increasingly benefits from central processing units that are becoming ‘indispensable’ in AI data centers
Wall Street isn’t giving Arm Holdings enough credit for a big business transformation, according to an analyst.
Arm ARM +3.62%, a chip designer, has been broadening well beyond smartphones and now stands to capitalize even more on the booming market for server central processing units, HSBC’s Frank Lee wrote in a note to clients.
That “game-changing” transition is “still being undervalued by the market,” Lee argued, but he sees room for Arm’s stock to climb more than 50% as the company’s momentum becomes better understood. It’s up 3.9% in Friday morning action, bringing its year-to-date gains to about 23%.Lee double-upgraded Arm’s stock on Friday, lifting his rating to buy from reduce and meaningfully boosting his price target to $205 from $90. He wrote that agentic artificial intelligence will spur even greater demand for CPUs....
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