Perhaps the most surprising element to today's outstanding half-year figures from UK chip designs champion ARM Holdings (ARM) is that they seem to have passed so many by.

Several broadsheets report the Cambridge-based firm's 4% share price jump as a positive read-across from Apple's (AAPL:NDQ) stronger-than-expected third quarter iPhone sales, barely seeming to note the UK's firm's own numbers.

As the Daily Telegraph's Steve Hawkes tweeted this morning, 'Quarterly profits at Arm Holdings, Brit microchip maker, up 30%. One of the country's best kept secrets, amazing business.' Even Hawkes made the elementary error of implying that ARM manufactures – it does not, it only sells intellectual property (IP).

Of course, Shares readers are not among those in the dark. Some of them may even have acted on my Play of the Week at the start of this month. Those that did are today sitting on a 18.4% paper profit.

What has got the market excited once more is yet another set of impressive numbers. You can read the details for yourselves, but aside from the 26% jump in revenues and dividends, 30% hike in taxable profits (after stripping out one-off £41.8 million patent squabble costs) or the record £96 million record net cash generation, what impresses the most is the new licences.

The mid-to-long-term success of an IP business model is whether a company’s technology is being taken up by its customers. In other words, how is licence growth trending? ARM's 25 new mobile licence wins, plus seven more for its Mali graphics designs, is a real coup – the latter also a factor in today's near 9% slump at rival GPU tech supplier Imagination Technologies (IMG).

ARM HOLDINGS - Comparison Line Chart (Rebased to first)

As analysts at investment bank Berenberg spelled out, 'we remember when this licence business was a $30 million a quarter business a few years back. This quarter ARM achieved three-times that, at $88.3 million.' Better still, that 32% year-on-year growth is encouragingly accelerating on the mid-20% increases of both the last two quarters. The order backlog is also up 10% quarter-on-quarter.

But for all the rapid growth, both real and implied by forecasts, on the revenue, profit and dividend lines, the shares remain a conundrum for many investors thanks to the consistently eye-watering rating.

By my calculations, the price to earnings (PE) multiple for next year (2014) stands at 38.3. This sort of valuation can lead to significant volatility in the share price, and plenty of debate.

Even the views within the Shares camp are mixed, as illustrated by editor Russ Mould's recent opinion piece which cast a more sceptical hew over the stock than my own.

I believe ARM represents short-term trading opportunities as market sentiment ebbs and flows or as a long-run buy and forget play for a pension. That view remains unchanged and will likely remain so regardless of market fads and fashion.

Issue Date: 24 Jul 2013