Mizuho analyst Vijay Rakesh advised investors to buy the recent dip in ARM stock, arguing the market is overly pessimistic about handset demand. The shares have fallen about 30% since November, while the Philadelphia Semiconductor Index gained 10%. Rakesh believes the decline is overdone.

The firm cites multiple growth catalysts beyond smartphones. Arm's royalty revenue, roughly 50% mobile, is projected to grow 7-31% annually through 2027. A shift to the v9 architecture, which doubles average selling price per core, is a key tailwind. Potential custom chip ramps in 2027-2028, including a possible AI ASIC for OpenAI and SoftBank, could add over $1 billion in top-line upside.

Hyperscaler adoption is also expanding Arm's server footprint. Designs for AWS Graviton, Microsoft Cobalt, and Meta's planned CPU are part of a growing customer base. Mizuho reiterated its Outperform rating and $190 price target, positioning ARM as the broadest global semiconductor platform.