Arm Holdings (ARM) Price Target Raised to $300 on AI and Data Center Momentum

Arm Holdings has drawn renewed interest from KeyBanc as the firm sees robust AI and data center demand accelerating licensing growth. The stock is twelfth on our list of 12 AI Stocks Wall Street Is Watching Now.

On May 7, KeyBanc analyst John Vinh raised the price target on Arm Holdings to $300 from $170 and maintained an Overweight rating. The company reported results for the fourth quarter and fiscal year ended 2026, having a record quarterly revenue of $1.49 billion driven by robust demand for cloud AI solutions.

Despite FQ4 revenue and EPS exceeding expectations, Keybanc noted mixed results for the semiconductor company. Licensing revenue beat forecasts, a big portion of Arm’s revenue. The company licenses its technology to companies such as Nvidia and Apple, collecting royalty payments on design use.

Arm Holdings (ARM) Price Target Raised to $300 on AI and Data Center Momentum

Close-up of Silicon Die are being Extracted from Semiconductor Wafer and Attached to Substrate by Pick and Place Machine. Computer Chip Manufacturing at Fab. Semiconductor Packaging Process.

However, it missed on royalty revenue due to a contraction in smartphone Total Addressable Market. This was mainly due to memory shortages and higher prices. KeyBanc noted ARM guiding 20% year-over-year royalty growth in the fiscal first quarter. This growth is driven by the migration to Armv9, CSS, and Data Center, noted the firm, which doubled in revenues again.

ARM also indicated it sees $2B in demand for its AGI CPU in FY28, vs. its $1B outlook, but is supply constrained currently and unable to meet demand. Despite mixed results, we raise ests and our PT to $300 due to licensing upside DC drivers.

Arm Holdings plc (NASDAQ:ARM) is a semiconductor and software design company that designs and licenses semiconductor technology and related products.

While we acknowledge the risk and potential of ARM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ARM and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 33 Stocks That Should Double in 3 Years and Cathie Wood 2026 Portfolio: 10 Best Stocks to Buy. 

Disclosure: None. Follow Insider Monkey on Google News.