ARM (NASDAQ: ARMH) is one of 103 publicly-traded companies in the “Semiconductors” industry, but how does it weigh in compared to its competitors? We will compare ARM to related companies based on the strength of its analyst recommendations, institutional ownership, dividends, risk, profitability, valuation and earnings.

Dividends

ARM pays an annual dividend of $0.34 per share and has a dividend yield of 0.5%. ARM pays out 35.4% of its earnings in the form of a dividend. As a group, “Semiconductors” companies pay a dividend yield of 1.6% and pay out 58.5% of their earnings in the form of a dividend.

Profitability

This table compares ARM and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ARM 33.10% 19.72% 16.87%
ARM Competitors -42.56% 0.62% 1.00%

Insider and Institutional Ownership

19.7% of ARM shares are owned by institutional investors. Comparatively, 65.1% of shares of all “Semiconductors” companies are owned by institutional investors. 3.0% of ARM shares are owned by insiders. Comparatively, 6.7% of shares of all “Semiconductors” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and target prices for ARM and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ARM 0 0 1 0 3.00
ARM Competitors 952 4848 8900 373 2.58

As a group, “Semiconductors” companies have a potential upside of 12.43%. Given ARM’s competitors higher possible upside, analysts clearly believe ARM has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares ARM and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
ARM N/A N/A 70.59
ARM Competitors $4.38 billion $573.56 million 39.34

ARM’s competitors have higher revenue and earnings than ARM. ARM is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

ARM beats its competitors on 7 of the 13 factors compared.

About ARM

ARM Holdings plc (ARM) is a company engaged in designing a range of inter-related intellectual property (IP), including microprocessors, Physical IP, and supporting software and tools. Its product offering includes 16/32/64-bit reduced instruction set computing (RISC) microprocessors, data engines, graphics processors, digital libraries, embedded memories, peripherals, software and development tools, as well as analog functions and high-speed connectivity products. The Company licenses and sells its technology and products to international electronics companies, which in turn manufacture, market and sell microprocessors, application-specific integrated circuits (ASICs), application-specific standard processors (ASSPs) and microcontrollers (MCUs) based on ARM’s technology to systems companies for incorporation into a range of end products. Its principal geographic markets are Europe, the United States and Asia Pacific.

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