Saturday, June 10, 2006

ARMed and ready

This week I became an investor in ARM Holdings PLC, the microprocessor intellectual property company.

I have ranted before about the lack of high profile UK technology companies but ARM is a NICE little company. With a market cap. of £1.5 billion ARM should make over £250 million in sales and £80 million in profits. That puts ARM on a 2006 PE of about 20 - not bad for a company growing at a rate of at least 20% with a dividend yield of almost 1% and buying back 2% of its shares a year.

ARM powered processors are found in mobile phones, portable games consoles, DLP TVs, PDAs, camcorders, iPods, navigation devices and countless other digital devices. As more and more household items go digital it is hard to imagine ARM's market shrinking.

All these factors suggest that ARM should be a low maintenance investment. It is a market leader in a growing market, on a very solid financial footing and is shareholder friendly.

One for the long term I feel.

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