Arm Holdings plc American Depositary Shares (ARM)vsMicrosoft Corporation (MSFT)
ARM
Arm Holdings plc American Depositary Shares
$244.74
-8.11%
TECHNOLOGY · Cap: $285.38B
MSFT
Microsoft Corporation
$390.54
-0.71%
TECHNOLOGY · Cap: $2.90T
Smart Verdict
WallStSmart Research — data-driven comparison
Microsoft Corporation generates 6369% more annual revenue ($318.27B vs $4.92B). MSFT leads profitability with a 39.3% profit margin vs 18.4%. MSFT appears more attractively valued with a PEG of 1.23. MSFT earns a higher WallStSmart Score of 72/100 (B).
ARM
Buy63
out of 100
Grade: C+
MSFT
Strong Buy72
out of 100
Grade: B
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Intrinsic value data unavailable for ARM.
Margin of Safety
-82.9%
Fair Value
$215.02
Current Price
$390.54
$175.52 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Mega-cap, among the largest globally
Conservative balance sheet, low leverage
Safe zone — low bankruptcy risk
Strong operational efficiency at 29.5%
Revenue surging 20.1% year-over-year
Earnings expanding 47.9% YoY
Mega-cap, among the largest globally
Every $100 of equity generates 30 in profit
Keeps 39 of every $100 in revenue as profit
Strong operational efficiency at 46.3%
Generating 15.8B in free cash flow
18.3% revenue growth
Areas to Watch
Expensive relative to growth rate
Weak financial health signals
Premium valuation, high expectations priced in
Trading at 31.4x book value
No major concerns identified
Comparative Analysis Report
WallStSmart ResearchBull Case : ARM
The strongest argument for ARM centers on Market Cap, Debt/Equity, Altman Z-Score. Profitability is solid with margins at 18.4% and operating margin at 29.5%. Revenue growth of 20.1% demonstrates continued momentum.
Bull Case : MSFT
The strongest argument for MSFT centers on Market Cap, Return on Equity, Profit Margin. Profitability is solid with margins at 39.3% and operating margin at 46.3%. Revenue growth of 18.3% demonstrates continued momentum.
Bear Case : ARM
The primary concerns for ARM are PEG Ratio, Piotroski F-Score, P/E Ratio. A P/E of 310.7x leaves little room for execution misses.
Bear Case : MSFT
No major red flags identified for MSFT, but monitor valuation.
Key Dynamics to Monitor
ARM carries more volatility with a beta of 3.77 — expect wider price swings.
ARM is growing revenue faster at 20.1% — sustainability is the question.
MSFT generates stronger free cash flow (15.8B), providing more financial flexibility.
Monitor SEMICONDUCTORS industry trends, competitive dynamics, and regulatory changes.
Bottom Line
MSFT scores higher overall (72/100 vs 63/100), backed by strong 39.3% margins and 18.3% revenue growth. Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Arm Holdings plc American Depositary Shares
TECHNOLOGY · SEMICONDUCTORS · USA
Arm Holdings plc architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers rely on to develop products.
Microsoft Corporation
TECHNOLOGY · SOFTWARE - INFRASTRUCTURE · USA
Microsoft Corporation is an American multinational technology company which produces computer software, consumer electronics, personal computers, and related services. Its best known software products are the Microsoft Windows line of operating systems, the Microsoft Office suite, and the Internet Explorer and Edge web browsers. Its flagship hardware products are the Xbox video game consoles and the Microsoft Surface lineup of touchscreen personal computers. Microsoft ranked No. 21 in the 2020 Fortune 500 rankings of the largest United States corporations by total revenue; it was the world's largest software maker by revenue as of 2016. It is considered one of the Big Five companies in the U.S. information technology industry, along with Google, Apple, Amazon, and Facebook.
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