Before you read this, understand that trying to buy IPOs when they begin trading isn't guaranteed and if you market buy, you will get roasted. It's not good to chase IPOs. No matter if this is the next NASDAQ:AAPLNASDAQ:TSLA and NASDAQ:AMZN combined, do not chase and only make wise and calculated decisions while trading.
I've been waiting for this IPO for a while. It's finally here. It might be the most over anticipated IPO in a while. Trade carefully. Do not chase blindly. Have a plan. Trade the plan. If it doesn't come, move on.
If you learn something or want to trade with me, give me a follow & join my community. Thanks.
IPO valued @ 55B.
Around $51 per share.
They are only releasing 9% of the total shares to the public. So it has a tiny float.
SoftBank is the owner, they bought ARM 7 years ago.
The floor for me is 40B USD valuation. Meaning, around $38.50 is support. Where did I get that number? NVDA was closing on buying ARM for 40B USD in 2020.
ARM designs chips & system processors & holds patents to chips and they license their technology to other big tech like AAPL, NVDA. Hence, NVDA wanted to buy them for 40B USD.
THE POSITIVES:
SoftBank bought out someone's 25% stake in ARM recently. For 16B USD. That puts it at a FWB:64B valuation in their eyes. That means the owner of ARM expects ARM to surpass 64B USD.
NVDA CEO loves ARM, but NVDA failed to acquire it.
NVDA CEO has been selling NVDA. Around 150k shares this year. Last sale 14M USD on 9/11/23. IMO he's freeing up to buy ARM @ IPO. Remember SoftBank is a 90% owner. Everyone who wants it gets it at IPO. Yes, even NVDA CEO.
The float is tiny, and asset managers .
NYSE:TSM expressed interest of 100M USD investment
This might be the most hyped IPO in a while.
THE NEGATIVES:
SoftBank is a known dumper.
SoftBank bought ARM in 2016 for 32B. They tried flipping it in 2020 for 40B USD to NVDA. So they were happy with a 8B flip USD in 4 years. Sus. Shows signs that if ARM does well, they'll unload.
Because SoftBank are known dumpers, once they dump one time, investors will get shook.
Their net income is low. Under 550M.
Their revenue is around 2.7B.
Their net income dropped YoY.
Again, I will evaluate if I'm buying this and post my entries/ exits in my community. Welcome to join.
Stay tuned.
Trade active
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Snagged just under $56. Sold at least 1/2 @ +10%.
Comment
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15 second chart looks good. These charts have wild swings tho, but nonetheless, it's something.
Hope this DD benefited somebody. Was a clear winner and most of us were able to get in at $56. Trade safe & welcome to join our community (link in profile).
thank you for sharing this well-written (trade) insight. Simple, not sophisticated and through the point. Wish to see more of this on TV
kingdips
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@RedKTrader, thanks a lot. I just saw this comment. I post a lot of these insights on TV and in my community. Link in profile. Welcome to join us.
jrothlander
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I bought 5 shares just for the fun of it at $51. So only $255. So I'm not a big investor. I was thinking about dumping 1K and just seeing what happens. But I don't want to lose 1K. I think it could drop to like $10 per share later today. I'll probably hang on to these 5 for the long term just because I like the company.
ARM is a great company and I love the company. They hold a 99% market share and their profits are huge... like 96%. It's not a massive company but you have already invested in them if you have a smart phone. I have met engineers that work for them and I have always liked the company. I own a few dozen of their development boards and as a product and a company, I love them. But... that doesn't mean their stock is worth $51 per share.
My guess is that it will run up to $60 and crash... then recover and run up to $65 and crash... the recover and run up to $70 and crash again... then at some point we will stop seeing these pump-and-dump patterns and it will start to drop and finally crash back hard in the next few days or weeks and start acting like a normal stock.
kingdips
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@jrothlander, thanks for your comment and taking the time to write it. It's always good to wait and see how an IPO stock transpires. Take a look at previous hot IPOs and how they ended up. No matter how hot an IPO was, it needs to prove itself in the real market and withstand the test of ERs, investor disappointment, and so on. ARM may or may not be a different beast since basically a few companies wanted to acquire it. That's its main edge. NVDA was willing to spend $39 per share, roughly. That'd be a good place to dump 1K I'd imagine. But remember, there's always another trade. I posted a free strategy in my community - welcome to check it out.
anyvilla256
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It's an important and nice information you are giving here. Thank you a lot!
kingdips
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@anyvilla256, no problem! Thank you! Welcome to join my community, lots of good insight there too! Link is on my profile page.
UnknownUnicorn60943104
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Good insight! Agree.
kingdips
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@gorillatrd, thanks 💯
CJMackinnon
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I am very tempted to go short on open but that is purely a gamble. If I do it’ll be a small position but am leaning more towards sitting on the sidelines and watching
kingdips
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@CJMackinnon, shorting it will be dangerous since it has a tiny float. Tbh. Look at other IPOs that weren't as popular but exploded anyway.