ARM has reclaimed the $400 level for the second time in a month, closing Tuesday at $396.34 after a 22% weekly gain — yet the short sellers who've ridden this stock through three separate reversals still haven't flinched.
The bears' resilience remains the defining feature of this tape. Shares short have crept up, not down — 18.55 million on June 16, roughly 1% more than a week ago and 15% above the mid-May base before the latest leg higher. That is the same story the previous two notes told, only with the stock now higher. What has shifted this week is the borrow market, and the move is notable. Availability has tightened materially — from 453% reported in the June 15 stock report all the way back to 275% as of June 16. That's still well within normal territory and nowhere near squeeze-level tightness, but it's the sharpest one-week contraction in availability since the May squeeze buildup. Cost to borrow remains negligible at 0.49%, so bears are not being mechanically forced out. Options tell a calmer story still: the put/call ratio at 1.21 sits almost exactly on its 20-day average of 1.23, with a z-score barely negative at -0.71. There is no unusual hedging activity building into the $400 reclaim.
The Street is catching up, but still hasn't caught the stock. The mean analyst price target is $262.70 — more than 30% below the current price. That figure, however, reflects a lag rather than a genuine bear view: the most recent changes all ran higher. Mizuho lifted its target to $500 on June 4, Wells Fargo moved to $410, and Barclays raised to $360 on June 1. B of A's Vivek Arya took his target to $335 as recently as June 11, maintaining a Neutral rating on a stock already trading nearly 20% through that number. The analyst recommendation divergence factor scores in the 99th percentile — meaning the gap between price and consensus is wider than almost any stock in the universe. Bulls anchor their thesis on ARM's 20% royalty revenue CAGR target through 2031, Armv9 adoption momentum, and a data-centre TAM the company projects growing from $330 billion to over $1.2 trillion by fiscal 2031. Bears flag SoftBank's 86% ownership as a structural liquidity constraint, worry that design services will shrink as a revenue share, and caution that raising royalty rates risks alienating the customers ARM needs to hit those targets. The EV/EBITDA multiple at 127x has compressed about 10 points over 30 days even as the stock has roughly doubled — a sign earnings estimates are being revised up fast enough to absorb some of the price move. The 12-month forward EPS growth estimate ranks in the 92nd percentile.
Insider selling adds a layer of context worth noting. The Chief Commercial Officer sold shares on four separate days between May 21 and June 2, totalling roughly $4.4 million in proceeds, with average prices ranging from $288 to $416. The Chief Accounting Officer sold 11,306 shares at $392.70 on June 2. Net 90-day insider activity is technically positive at 220,000 shares, suggesting some offsetting grant activity, but the open-market pattern is entirely one-directional: executives are selling into strength. The significance scores on these trades are modest, and none of this is unusual for a stock at all-time highs with large equity compensation plans, but it reinforces that those closest to the business are not adding exposure at current levels.
Peer semis spent the week broadly weaker on Tuesday — MRVL fell nearly 10% on the day, RMBS dropped 7.5%, and MX shed 7.3% — making ARM's Tuesday dip of 3.9% look contained by comparison. Earnings are next due July 29. The prior two prints delivered a 2.1% and 14.7% one-day gain respectively, with five-day follow-throughs of 5.9% and 10.5%. With the stock already up 89% over the past month, the July report is less about whether ARM is growing and more about whether royalty rate expansion and data-centre CPU traction can justify a valuation the Street's own models haven't yet caught up to.
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