ARM Holdings: Computex Likely To Drive Next Leg Down
I believe that I may have severely underestimated the fragility of ARM's (ARMH) share price in the face of potential design win loss to Intel's (INTC) chips. In just a couple of days, shares of ARM Holdings have crashed from $50.56 to the most recent close of $45.82 following ARM's recent investor meeting. Morgan Stanley (MS) recommending shorting the shares on almost exactly the same reasons that have fueled my thesis (valuation, Intel threat, ASP erosion in smartphone space, etc.), which may have sparked this initial drop. However, I believe that we are now about to see a fundamental shift in sentiment that will do some very serious damage to ARM's multiple. The upcoming "Computex" event in Taipei, Taiwan will likely trigger the next leg down.