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DCF Valuation
Base-case fair value
$35.89
Intrinsic $47.85 · 25% MOS
Current price: $418.88
Base-case summary
Our base-case DCF for Arm Holdings PLC (ARM) projects 10 years of free cash flow growth at 19.9% for years 1–5 and 10.0% for years 6–10, anchored to 19.9% historical FCF growth, then applies a 2.5% perpetual growth rate and a 8.0% discount rate. Starting from $949M in trailing free cash flow, this produces an intrinsic value of $47.85 per share. A 25% safety margin gives a fair value of $35.89, suggesting the stock is currently 91% overvalued against the $418.88 market price.
See 3 scenarios side by side
Conservative, Base, and Optimistic fair values, plus the sensitivity matrix and FCF history. Free account.
Model inputs
TTM Free Cash Flow
$949M
Cash & equivalents
$3.6B
Total debt
$457M
Shares outstanding
1.1B