ARM Holdings plc shares have fallen 20% in the past year, while the industry advanced 38%. Investors should reassess the stock’s prospects.

Arm Holdings is a key player in energy-efficient AI computing, with its architecture delivering superior performance per watt.

NVIDIA competes with ARM in edge computing and AI-driven device workloads, but ARM’s mobile reach gives it a strong position.

Arm Holdings is expected to see solid earnings and revenue growth, with earnings projected to grow by 5.5% in fiscal 2026.

ARM’s valuation remains stretched, trading at a premium compared to industry averages, leaving limited room for error.

Investors who already own ARM should continue to hold, but the stock’s current valuation may cap near-term returns.

ARM currently carries a Zacks Rank #3 (Hold) and is expected to see strong growth in the coming years.

Read more at Nasdaq: ARM Stock Down 20% in a Year vs Industry Gains: Buy Signal or Caution?