Menu
Investing
Are Dell, HP zombie stocks?
Gun industry, gun stocks have boomed under Obama
Fertilizer standoff for Potash of Saskatchewan
PepsiCo has a new sweetener mix
Inside Wall Street: Chipotle may remain weak
What's wrong with McDonald's?
Secret Santa for stock pickers
Harley revs up in India
Gold ETF poised to test key support
Merck drops as heart drug falls short in study
Is Yum Brands having a problem in China?
Can United Continental fly higher?
How much will the market tank on tax bill failure?
Bond trap in the wake of a US credit downgrade
Boehner's defeat is no big deal
Recreational vehicles keep driving forward
Michael Kors dresses for success in 2013
Dear RIM: Wall Street doesn't date losers
3 industries set for a fiscal cliff dive
Futures drop on fiscal cliff fears
Why Altria is overvalued
Brazil: Next international frontier for Gap
Top picks 2013: CVS and Yahoo
To Michigan governor: If it ain't broke, don't fix it
Top picks 2013: ARM Holdings
ARM Holdings (ARMH -0.64%) doesn't make anything. Yet it has annual sales of $872 million, thanks to licensing of its intellectual property.

And thanks to a business model that's low on physical investment, the company's after-tax profit margins have averaged a plump 36% in the past year. As a result, ARMH has a market cap of nearly $17 billion! And I think it will get much larger.

ARM's business, which is well known to many investors, is designing semiconductors. It has expertise in chips for computers and digital TVs, but the big market, and the fastest-growing market, is the one for mobile phones, where ARM is dominant.

It's also big in tablets, a category that is growing like wildfire. Odds are extremely good that the company will be able to continue billing itself as "the world's leading semiconductor intellectual property supplier," in part because its difficult for a customer to shift once it's committed to working with ARM.

For its part, ARM boasts that its designs have the best combination of reliability, low power usage and compactness. And as mobile devices continue to proliferate, taking market share away from desktop and laptop computers, the advantages of ARM's designs in keeping weight down and battery life up are a powerful draw.

Now, the success of a business does not guarantee the success of a stock, but I have great expectations for ARMH because of its chart.

It climbed strongly from the market's 2009 bottom through 2010 and into the summer of 2011, where it entered a long trading range between $22 and $30, as it performed slightly worse than the market, on average.

It stayed in that range for 22 long months. And then came this year's third-quarter earnings report, where management revealed that business was booming.

Investors quickly stampeded on board, spiking the stock up and out of that trading range and kicking off a new uptrend that I believe has far to go. The past three weeks have seen the stock pause between $36 and $37 and I think that's a decent entry point.

Mario Monti 'available to lead Italy'
Norwegian minister Espen Eide urges UK caution on quitting EU
Bank reform plans should be tougher, Banking Commission says
US fiscal cliff: Boehner still hopes for deal
Alcohol duty fraud: Action needed, say off-licences
LSE agrees LCH Clearnet deal at lower price
Retailers predict 'acceptable' Christmas trading figures
Retailers 'facing critical financial issues'
Wal-Mart pulls ad, Dick's halts assault rifle sales
Fix fiscal cliff or risk downgrade, says Fitch
What a new inflation measure would mean for your wallet
Citigroup shareholders push for break up
Buyers prepare bids for Hostess assets
O'Reilly AlphaTech closes third venture fund
Twilight poised to lift Hollywood to record year
Wal-Mart warns workers on Black Friday strike
The looming disaster the Fed's stress tests miss
4 ways Wall Street can ante up for fiscal health
Dividend investors prepare for fiscal cliff
Middle East violence pushes oil prices up
NYSE hires former homeland security chief
Bank of Japan punts on rates amid political turmoil
The 1% bets on the fiscal cliff
Exclusive: Sun Capital wants to buy Hostess
Green Mountain names new CEO
No merger bonuses for Xstrata execs
Eurozone risks rising as outlook darkens
Fiscal cliff: A modest proposal
Top picks 2013: ARM Holdings
Has Mario Monti done a good job?
The fresh approach to keeping deliveries like clockwork
Retirement: Doom and gloom or golden opportunity?
Clinton Cards has a new look, but can its reinvention work?
GB Paralympics funding increased
Rangers share issue raises £22m
BAE Systems wins £2.5bn Oman Hawk and Typhoon contract
Blackberry-maker Research in Motion sees big fall in profits
Bank of Japan boosts stimulus to help revive growth
UK retail sales flat in November
US home sales hit three-year high as GDP revised up
Energy bills: Ofgem must take firmer action, MPs say
Home rental costs record rare dip, says LSL
Insurance rules on gender will alter prices
Facebook tests charging $1 to send messages to strangers
Cathay Pacific averts cabin crew industrial action
ArcelorMittal cuts $4.3bn from value of Europe business
BMG buys up rights to thousands of hit songs
Statoil to create 700 jobs in North Sea development
News Corporation says publishing arm lost $2.1bn
UK borrowing higher than expected as GDP revised down
Nike shares jump 6.2% on strong home demand
Steve Jobs' high-tech yacht impounded over bill dispute