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The 1-Year Sortino Ratio measures the additional return that an investor receives per unit of the downside risk over the past year. As of today (2026-08-22), ARM Holdings's 1-Year Sortino Ratio is 2.00.
ARM Holdings (NAS:ARM) 1-Year Sortino Ratio Explanation
The 1-Year Sortino Ratio inidicates the risk-adjusted return of an investment over the past year. It is calculated as the annualized result of the average monthly excess return divided by the standard deviation of negative returns over the past year. The monthly excess return is the monthly investment return minus the monthly risk-free rate (typically the 10-year Treasury Constant Maturity Rate). If the risk-free rate for a specific region is not available, U.S. data is used by default.
Differnt from the Sharpe Ratio that penalizes both upside and downside volatility equally, the Sortino Ratio penalizes only those returns falling below a user-specified target or required rate of return. The expected returns here is set to the risk-free rate as well.
ARM Holdings 1-Year Sortino Ratio Related Terms
ARM vs TXN, ADI, QCOM: 1-Year Sortino Ratio Comparison
For the Semiconductors subindustry, ARM Holdings's 1-Year Sortino Ratio, along with its competitors' market caps and 1-Year Sortino Ratio data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
ARM Holdings 1-Year Sortino Ratio vs Semiconductors Industry
For the Semiconductors industry and Technology sector, ARM Holdings's 1-Year Sortino Ratio distribution charts can be found below:
* The bar in red indicates where ARM Holdings's 1-Year Sortino Ratio falls into.
The 1-Year Sortino Ratio measures the risk-adjusted return of an investment asset or portfolio over the past year, focusing specifically on downside risk rather than total risk. A stock / portfolio's 1-Year Sortino Ratio can be calculated by dividing the difference between the one-year returns of the investment and the risk-free rate, by the standard deviation of the downside risks over one year.
A downside risk is a potential loss from the asset or investment. The Downside risk here is measured by the downside deviation, which is the standard deviation of negative returns.
ARM Holdings (ARM) has a 1-Year Sortino Ratio of 2.00 as of Aug. 22, 2026. 1-Year Sortino Ratio measures the additional return that an investor receives per unit of the downside risk. View historical data for ARM Holdings and its competitors.
Is ARM Holdings' 1-Year Sortino Ratio too high?
ARM Holdings' current 1-Year Sortino Ratio is 2.00. Overall, ARM Holdings has a GF Score™ of 72/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does ARM Holdings' 1-Year Sortino Ratio compare to TXN and ADI?
ARM Holdings' 1-Year Sortino Ratio of 2.00 can be compared against companies in the Semiconductors industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good 1-Year Sortino Ratio for a Semiconductors company?
A good 1-Year Sortino Ratio depends on the Semiconductors industry context. However, 1-Year Sortino Ratio should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high 1-Year Sortino Ratio mean?
A high 1-Year Sortino Ratio can signal that a stock is expensive relative to its fundamentals. 1-Year Sortino Ratio measures the additional return that an investor receives per unit of the downside risk. View historical data for ARM Holdings and its competitors. ARM Holdings's current 1-Year Sortino Ratio is 2.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is ARM Holdings stock overvalued right now?
Based on GuruFocus' analysis, ARM Holdings (ARM) is currently considered Modestly Overvalued. The stock's GF Value™ is $190.20, compared to a current price of $243.32 — trading 27.9% above its estimated fair value. The current 1-Year Sortino Ratio is 2.00. ARM Holdings' overall GF Score™ is 72/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 1-Year Sortino Ratio calculated?
1-Year Sortino Ratio is calculated from a company's financial statements. For ARM Holdings (ARM), the current 1-Year Sortino Ratio is 2.00 as of Aug. 22, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is ARM Holdings (ARM) Overvalued in 2026?
Based on GuruFocus' analysis, ARM Holdings stock appears to be overvalued.
The current stock price of $243.32 is trading 27.9% above its estimated GF Value™ of $190.20.
GuruFocus considers ARM Holdings to be Modestly Overvalued.
Key valuation signals for ARM:
1-Year Sortino Ratio: 2.00
GF Value™: $190.20 vs. price of $243.32 (27.9% above fair value)
No single metric tells the full story. See the ARM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Arm Holdings is the IP owner and developer of the Arm architecture, which is used in 99% of the world's smartphone CPU cores. It also has high market share in other battery-powered devices like wearables, tablets, and sensors. Arm licenses its architecture for a fee, offering different types of licenses depending on the flexibility the customer needs. Customers like Apple or Qualcomm buy architectural licenses, which allow them to modify the architecture and add or delete instructions to tailor the chips to their specific needs. Other clients directly buy off-the-shelf designs from Arm. Both off-the-shelf and architectural customers pay a royalty fee per chip shipped. In 2026, Arm announced the launch of its own CPU products on top of its existing royalty business.
72GF Score
Get the complete analysis for ARM
1-Year Sortino Ratio is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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