ARM Holdings: Bears Dominate Options Trading Landscape

In a bearish turn for ARM Holdings, options traders show 62% of positions leaning negative. The firm remains a key player in the mobile CPU market with strong analyst support. As bearish sentiment prevails, investor caution may escalate for ARM's stock performance.

Date: 05-03-2025

AI Rating: 5

In this report, the sentiment towards ARM Holdings is decidedly bearish, as evidenced by the options trading data. Notably, 62% of the 8 trades were placed with bearish expectations, indicating a lack of confidence among large investors. While the $1.7 million in call options suggests some bullish hope, the predominance of puts totaling $346,388 may drive sentiment further down.

Options Activity and Price Range
The current predicted price range for ARM Holdings is estimated between $110.0 and $140.0. This range suggests significant concern among traders about the near-term price movements, particularly with bearish options trades dominating the activity. The average open interest was reported at 928.8 for today’s options trades, with a total volume of 3,983.00. This reflects a high level of activity and interest in both call and put trades, but primarily points towards bearish sentiment among larger players in the market.

Market Position
ARM Holdings remains a critical intellectual property supplier, maintaining strong relevance in the smartphone and battery-powered device markets, holding a substantial market share. Despite this foundational strength, the bearish options trend could pressure stock prices negatively. Furthermore, the trading volume of 2,237,232 shows a minor gain of 0.35% to a price of $122.92, though it may not be enough to sustain investor confidence.

Expert Opinions and Ratings
Expert ratings for ARM Holdings are generally optimistic, indicating a consensus target price of $189.8 from five market experts. Notably, several analysts have issued Buy ratings with target prices ranging from $174 to $200. This indicates underlying support for the stock amongst analysts, suggesting that there may be value to be found despite the bearish market sentiment at present.

Overall, while the bearish trading activity poses potential risks to ARM's stock performance, the strong underlying business model and analyst support could provide stabilization moving forward.

Stocks: ARM