UPDATE: Benchmark Company Downgrades ARM Holdings plc to Hold, Lowers PT on Less Favorable View of Chip Sector

In a report published Monday, Benchmark Company analyst Gary Mobley downgraded the rating on ARM Holdings plc ARMH from Buy to Hold, and lowered the price target from $54.00 to $50.00. In the report, Benchmark Company noted, “Due primarily to our less favorable opinion of the chip group, we are downgrading our rating on shares of ARM Holdings (ARMH) from ‘Buy' to ‘Hold'. To adjust for a lower assumed valuation multiple, we are lowering our price target from $54 to $50. We are not changing our estimates. Shares are trading at lofty valuation multiple, supported by several positive secular trends as well as an improving competitive market position. However, a high valuation multiple may make shares susceptible to underperformance should the chip group fall out of favor. We are aware that ARM TechCon kicks off this week, and mostly likely, the company will make several important announcements. Thus, our rating downgrade may seem slightly premature.” ARM Holdings plc closed on Friday at $47.95.