ARM has given back nearly a fifth of its value in a single week, falling to $324.86 from the $400-plus highs of early June, yet the short sellers who survived the May squeeze show no sign of covering.
The most striking feature of this pullback is what bears have not done. Absolute shares short have barely moved, holding around 18.4 million shares — up a marginal 0.25% on the week. The previous note flagged that shorts held firm through the 13% single-session drop on June 5; the data now confirms they are still sitting tight after a further leg lower. What has changed is the borrow market, and the shift cuts against any squeeze thesis. Availability has expanded sharply — climbing from roughly 206% to 277% over the past week, the most room in the lending pool since late May. Cost to borrow remains negligible at under 0.50%. With shares easy to source and cheap to hold, there is no mechanical pressure forcing bears to exit. Options positioning is similarly unremarkable: the put/call ratio at 1.20 sits fractionally below its 20-day average of 1.21, nearly half a standard deviation light on the bearish side. For a stock that just fell 19% in five sessions, options traders look remarkably calm.
The analyst community, meanwhile, has become the story's most surreal element. Mizuho raised its target to $500 on June 4. Barclays is at $360, Wells Fargo at $410 — all while the stock now trades at $324.86. The consensus mean stands at roughly $255, still 22% below the current price. Goldman Sachs remains the lone Sell, with a $150 target that the stock lapped months ago. The Street has been in pure catch-up mode since May earnings, and the week's selloff has done nothing to change that dynamic: every recent analyst action has been a raise, zero have been cuts. Valuation multiples tell the other side of that story bluntly. The trailing P/E is around 127x and EV/EBITDA north of 104x — both compressing week-over-week as the price falls, but still pricing in a level of growth execution that leaves almost no room for error. The factor score on EV/EBIT ranks in the bottom 2nd percentile of the universe. Bulls point to 20% CAGR royalty growth through 2031 and the AGI CPU opportunity; bears note the SoftBank dependency and the risk that customers push back on rising royalty rates.
The ownership picture adds a structural wrinkle worth noting. SoftBank holds 86.4% of shares, which means the publicly traded float is thin relative to the market cap. Several active managers — Altimeter, Schroder, Capital Research — added meaningful positions in the March-to-April reporting period, suggesting genuine institutional conviction at lower price levels. Whether those buyers feel the same at $325 after a 52% one-month gain is a different question.
The setup heading into the next earnings print on July 29 is a stock that has repriced dramatically, with short sellers dug in but under no mechanical stress, analysts still well below the current price on their targets, and a borrow market that has loosened considerably from its tightest levels. The key variable to watch is whether the short interest conviction holds through the rest of the month, or whether a further price decline finally triggers the first meaningful cover since the squeeze began.
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