ARM heads into its July 29 print in a materially different position from just days ago: the stock has given back most of last week's rally and sentiment signals have reversed.
The most important update is the price. ARM closed Thursday at $260.01, down 8.1% on the day and off 2.7% for the week — erasing the bulk of the 7.5% jump flagged in the prior note. That move leaves bears who rebuilt short positions in the $315–$323 range still deeply offside, but the short-seller relief that appeared on Tuesday has faded fast. Short interest itself is essentially unchanged, holding near 17.1 million shares, with the week-on-week change less than 0.4%. The borrow market offers no particular signal: cost to borrow has eased roughly 10% over the week to 0.43% — firmly in "easy borrow" territory — and availability at 265% means there are nearly three shares available to lend for every one currently out on loan. Bears are not being squeezed out of their positions.
Options positioning has also reversed. The prior note described a sharp call-heavy rotation, with the put/call ratio dropping almost three standard deviations below its 20-day mean. That signal has unwound. The PCR now reads 1.19, roughly in line with — and slightly below — its 20-day average of 1.22, sitting about 1.3 standard deviations below that mean. The reading is now closer to neutral than either extreme. Investors appear to have neither rebuilt their put hedges nor pressed the call-buying momentum from Tuesday's spike.
The analyst picture going into the print is genuinely split. Several firms cut targets sharply this week: UBS lowered to $360 from $470, Wells Fargo trimmed to $350 from $410, and HSBC downgraded to Hold while raising its target to $315. Against that, Susquehanna lifted its target to $320, and Keybanc's $430 target sits well above the current price. The consensus mean sits near $301 — a modest premium to the $260 close. Bulls point to the company's projected 20% royalty revenue CAGR through 2031, accelerating Armv9 adoption, and the potential for its AGI CPU to open a new revenue stream approaching $15 billion by fiscal 2031. Bears flag the SoftBank overhang, the risk that raising royalty rates alienates licensees, and a valuation that, even after the recent 29% one-month decline, carries a trailing PE close to 97x and EV/EBITDA above 80x. The 12-month forward EPS growth rank is in the 92nd percentile of the universe — the growth case is not in question. The dispute is whether that growth justifies the multiple.
Past earnings give the stock a constructive recent track record. The May 2026 print delivered a 2.1% one-day gain and nearly 6% over the following five days. The March 2026 print saw a 14.7% one-day move. Neither print was negative. The question this time is whether guidance on royalty rates, data-center CPU traction, and SoftBank-related dynamics can hold a multiple that the market has already begun compressing — the July 29 report is less a test of whether ARM is growing and more a test of whether the growth trajectory still justifies owning the stock at a price the Street is actively reassessing.
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