Chip designer Arm Holdings (ARM) and conglomerate SoftBank Group (SFTBF) reportedly tried to buy Cerebras Systems before the AI computing company’s expected IPO, according to Bloomberg. The early approach was rejected, and representatives for SoftBank, Arm, and Cerebras declined to comment. The timing is important because Cerebras is preparing to price its shares on Wednesday in a listing that could value the company at around $34 billion, although the final valuation could still change depending on pricing and the number of shares sold.
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High conviction NVDA bears now have this Tradr ETFMeanwhile, demand for the IPO appears strong. Indeed, Cerebras has been telling potential investors that it may price the offering above its marketed range of $150 to $160 per share. The company plans to sell 30 million shares, which could raise about $4.8 billion and make it the biggest listing of the year so far. That would also put the deal close to Arm’s record semiconductor IPO in 2023, while giving Cerebras a chance to position itself as a serious AI-chip challenger to Nvidia (NVDA).
Interestingly, Cerebras is attacking the same AI data center market, but with a different approach. More specifically, it uses giant chips made from a single silicon wafer. Its founder and CEO, Andrew Feldman, has argued that this method could make AI systems faster and more responsive, and OpenAI has already used Cerebras chips to train one of the models it released earlier this year.
Is ARM Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on ARM stock based on 18 Buys, three Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average ARM price target of $253.35 per share implies 16.2% upside potential.
