ARMH was recommended by Blue Chip Growth at $28.69 in Investment Digest issue 692, dated April 6, 2011. ARMH closed yesterday at $25.33.
“After eight weeks on Hold, the time has come to sell ARM Holdings PLC (ARMH). I still love the company and strongly believe it’s in a cutting-edge industry with a bright long-term future. BUT, rule #1 of our investing strategy is never fall in love with a stock story — no matter how good it is.
“After running my rigorous weekend screens, the numbers show that buying pressure is deteriorating. Last week, ARM Holdings released solid operating results for the first quarter, but investors were spooked by the news that industry shipments were on the decline. As a result, buying pressure for ARMH has dipped below our threshold to a Quantitative grade of D.
“This company has an unparalleled handhold on the chips that power smartphones and tablets, and I expect ARM Holdings to continue to grow its market share. However, the near-term outlook for the industry is very weak. Expectations are for a 43% profit loss for the semiconductor industry next quarter. The near-term industry troubles outweigh the long-term benefits at this time, and we must reduce our exposure to the semiconductor industry.
“I may add ARMH back to the Buy List once the industry as a whole firms up, but in the meantime, in order to keep beating the market 3-to-1 in the near-term, I want you to focus on our stocks with the smoothest and steadiest returns.”
- Louis Navellier, Blue Chip Growth, April 30, 2012