ARM vs. CRM: A Head-to-Head Stock Comparison
Here’s a clear look at ARM and CRM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | ARM | CRM |
|---|---|---|
| Company Name | Arm Holdings plc | Salesforce, Inc. |
| Country | United Kingdom | United States |
| GICS Sector | Information Technology | Information Technology |
| GICS Industry Group | Semiconductors & Semiconductor Equipment | Software & Services |
| GICS Industry | Semiconductors & Semiconductor Equipment | Software |
| GICS Sub-Industry | Semiconductors | Application Software |
| Market Capitalization | 226.26 billion USD | 148.74 billion USD |
| Currency | USD | USD |
| Exchange | NasdaqGS | NYSE |
| Listing Date | September 14, 2023 | June 23, 2004 |
| Security Type | ADR | Common Stock |
ARM trades as an American Depositary Receipt (ADR), offering U.S. investors a convenient way to access its foreign-listed shares. In contrast, CRM is a standard domestic listing.
ARM’s market capitalization (226.26 billion USD) is substantially larger than CRM’s (148.74 billion USD), indicating a significant difference in their market valuations.
ARM trades as an American Depositary Receipt (ADR), offering U.S. investors a convenient way to access its foreign-listed shares. In contrast, CRM is a standard domestic listing.
Historical Performance
This chart compares the performance of ARM and CRM by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.
Historical Performance at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| 5-Day Price Return | 1.82% | -1.97% |
| 13-Week Price Return | 71.91% | -4.29% |
| 26-Week Price Return | 26.07% | -30.18% |
| 52-Week Price Return | 83.64% | -35.00% |
| Month-to-Date Return | 1.11% | 3.00% |
| Year-to-Date Return | 94.54% | -31.37% |
| 10-Day Avg. Volume | 11.78M | 11.28M |
| 3-Month Avg. Volume | 7.72M | 12.75M |
| 3-Month Volatility | 80.74% | 43.12% |
| Beta | 3.41 | 1.14 |
ARM’s beta of 3.41 points to significantly higher volatility compared to CRM (beta: 1.14), suggesting ARM has greater potential for both gains and losses relative to market movements.
Profitability
Return on Equity (TTM)
ARM
11.03%
Semiconductors & Semiconductor Equipment Industry
- Max
- 48.79%
- Q3
- 19.91%
- Median
- 7.83%
- Q1
- -0.38%
- Min
- -30.27%
ARM’s Return on Equity of 11.03% is on par with the norm for the Semiconductors & Semiconductor Equipment industry, indicating its profitability relative to shareholder equity is typical for the sector.
CRM
12.37%
Software Industry
- Max
- 66.41%
- Q3
- 24.77%
- Median
- 10.70%
- Q1
- -3.47%
- Min
- -39.77%
CRM’s Return on Equity of 12.37% is on par with the norm for the Software industry, indicating its profitability relative to shareholder equity is typical for the sector.
Net Profit Margin (TTM)
ARM
17.15%
Semiconductors & Semiconductor Equipment Industry
- Max
- 55.60%
- Q3
- 23.27%
- Median
- 9.46%
- Q1
- -1.13%
- Min
- -34.23%
ARM’s Net Profit Margin of 17.15% is aligned with the median group of its peers in the Semiconductors & Semiconductor Equipment industry. This indicates its ability to convert revenue into profit is typical for the sector.
CRM
17.96%
Software Industry
- Max
- 46.40%
- Q3
- 19.46%
- Median
- 11.92%
- Q1
- -2.39%
- Min
- -33.25%
CRM’s Net Profit Margin of 17.96% is aligned with the median group of its peers in the Software industry. This indicates its ability to convert revenue into profit is typical for the sector.
Operating Profit Margin (TTM)
ARM
18.67%
Semiconductors & Semiconductor Equipment Industry
- Max
- 60.38%
- Q3
- 26.31%
- Median
- 11.65%
- Q1
- 2.49%
- Min
- -25.47%
ARM’s Operating Profit Margin of 18.67% is around the midpoint for the Semiconductors & Semiconductor Equipment industry, indicating that its efficiency in managing core business operations is typical for the sector.
CRM
19.34%
Software Industry
- Max
- 49.62%
- Q3
- 24.87%
- Median
- 13.22%
- Q1
- -3.48%
- Min
- -43.76%
CRM’s Operating Profit Margin of 19.34% is around the midpoint for the Software industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| Return on Equity (TTM) | 11.03% | 12.37% |
| Return on Assets (TTM) | 8.38% | 7.39% |
| Net Profit Margin (TTM) | 17.15% | 17.96% |
| Operating Profit Margin (TTM) | 18.67% | 19.34% |
| Gross Profit Margin (TTM) | 97.50% | 77.68% |
Financial Strength
Current Ratio (MRQ)
ARM
5.43
Semiconductors & Semiconductor Equipment Industry
- Max
- 7.65
- Q3
- 4.54
- Median
- 2.79
- Q1
- 2.25
- Min
- 1.23
ARM’s Current Ratio of 5.43 is in the upper quartile for the Semiconductors & Semiconductor Equipment industry. This signifies a strong liquidity position, suggesting the company is well-equipped to cover its immediate liabilities compared to its peers.
CRM
0.76
Software Industry
- Max
- 3.83
- Q3
- 2.30
- Median
- 1.56
- Q1
- 1.03
- Min
- 0.08
CRM’s Current Ratio of 0.76 falls into the lower quartile for the Software industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
Debt-to-Equity Ratio (MRQ)
ARM
0.00
Semiconductors & Semiconductor Equipment Industry
- Max
- 1.34
- Q3
- 0.61
- Median
- 0.25
- Q1
- 0.02
- Min
- 0.00
Falling into the lower quartile for the Semiconductors & Semiconductor Equipment industry, ARM’s Debt-to-Equity Ratio of 0.00 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
CRM
0.24
Software Industry
- Max
- 2.40
- Q3
- 1.04
- Median
- 0.30
- Q1
- 0.00
- Min
- 0.00
CRM’s Debt-to-Equity Ratio of 0.24 is typical for the Software industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
Interest Coverage Ratio (TTM)
ARM
6.95
Semiconductors & Semiconductor Equipment Industry
- Max
- 114.00
- Q3
- 48.87
- Median
- 13.77
- Q1
- 2.21
- Min
- -37.06
ARM’s Interest Coverage Ratio of 6.95 is positioned comfortably within the norm for the Semiconductors & Semiconductor Equipment industry, indicating a standard and healthy capacity to cover its interest payments.
CRM
19.86
Software Industry
- Max
- 45.58
- Q3
- 18.40
- Median
- 2.26
- Q1
- -7.94
- Min
- -46.66
CRM’s Interest Coverage Ratio of 19.86 is in the upper quartile for the Software industry, signifying a strong and healthy capacity to meet its interest payments from operating profits.
Financial Strength at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| Current Ratio (MRQ) | 5.43 | 0.76 |
| Quick Ratio (MRQ) | 5.16 | 0.70 |
| Debt-to-Equity Ratio (MRQ) | 0.00 | 0.24 |
| Interest Coverage Ratio (TTM) | 6.95 | 19.86 |
Growth
Revenue Growth
Revenue Growth at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| Revenue Growth (MRQ vs Prior YoY) | 26.35% | 12.09% |
| Revenue Growth (TTM vs Prior YoY) | 26.45% | 9.58% |
| 3-Year Revenue CAGR | 14.02% | 9.82% |
| 5-Year Revenue CAGR | -- | 14.34% |
EPS Growth
EPS Growth at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| EPS Growth (MRQ vs Prior YoY) | -11.91% | 17.51% |
| EPS Growth (TTM vs Prior YoY) | -1.24% | 22.65% |
| 3-Year EPS CAGR | 11.67% | 234.40% |
| 5-Year EPS CAGR | -- | 12.24% |
Dividend
Dividend Yield (TTM)
ARM
0.00%
Semiconductors & Semiconductor Equipment Industry
- Max
- 1.98%
- Q3
- 0.82%
- Median
- 0.28%
- Q1
- 0.00%
- Min
- 0.00%
ARM currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
CRM
1.07%
Software Industry
- Max
- 1.07%
- Q3
- 0.45%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 1.07%, CRM offers a more attractive income stream than most of its peers in the Software industry, signaling a strong commitment to shareholder returns.
Dividend Payout Ratio (TTM)
ARM
0.00%
Semiconductors & Semiconductor Equipment Industry
- Max
- 168.19%
- Q3
- 77.18%
- Median
- 22.20%
- Q1
- 0.00%
- Min
- 0.00%
ARM has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
CRM
21.28%
Software Industry
- Max
- 42.71%
- Q3
- 17.28%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
CRM’s Dividend Payout Ratio of 21.28% is in the upper quartile for the Software industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.
Dividend at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| Dividend Yield (TTM) | 0.00% | 1.07% |
| Dividend Payout Ratio (TTM) | 0.00% | 21.28% |
Valuation
Price-to-Earnings Ratio (TTM)
ARM
283.30
Semiconductors & Semiconductor Equipment Industry
- Max
- 185.71
- Q3
- 102.41
- Median
- 61.27
- Q1
- 41.18
- Min
- 14.19
At 283.30, ARM’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Semiconductors & Semiconductor Equipment industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
CRM
19.95
Software Industry
- Max
- 124.17
- Q3
- 63.63
- Median
- 32.01
- Q1
- 20.28
- Min
- 9.45
In the lower quartile for the Software industry, CRM’s P/E Ratio of 19.95 suggests the stock may be undervalued compared to its peers, potentially presenting an attractive entry point for investors.
Price-to-Sales Ratio (TTM)
ARM
48.58
Semiconductors & Semiconductor Equipment Industry
- Max
- 33.30
- Q3
- 16.06
- Median
- 7.81
- Q1
- 4.30
- Min
- 0.53
With a P/S Ratio of 48.58, ARM trades at a valuation that eclipses even the highest in the Semiconductors & Semiconductor Equipment industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
CRM
3.58
Software Industry
- Max
- 16.07
- Q3
- 8.86
- Median
- 5.64
- Q1
- 3.38
- Min
- 0.91
CRM’s P/S Ratio of 3.58 aligns with the market consensus for the Software industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio (MRQ)
ARM
15.08
Semiconductors & Semiconductor Equipment Industry
- Max
- 15.44
- Q3
- 8.01
- Median
- 3.71
- Q1
- 1.75
- Min
- 0.74
ARM’s P/B Ratio of 15.08 is in the upper tier for the Semiconductors & Semiconductor Equipment industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.
CRM
3.34
Software Industry
- Max
- 24.98
- Q3
- 12.19
- Median
- 6.54
- Q1
- 3.34
- Min
- 0.38
CRM’s P/B Ratio of 3.34 is in the lower quartile for the Software industry. From a value investing perspective, this is favorable, as it suggests the stock is trading at a discount to its net asset value and may offer a greater margin of safety.
Valuation at a Glance
| Symbol | ARM | CRM |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 283.30 | 19.95 |
| Price-to-Sales Ratio (TTM) | 48.58 | 3.58 |
| Price-to-Book Ratio (MRQ) | 15.08 | 3.34 |
| Price-to-Free Cash Flow Ratio (TTM) | 236.62 | 10.33 |