In the latest close session, Synopsys (SNPS) was down 1.59% at $501.39. The stock's performance was behind the S&P 500's daily gain of 0.03%. At the same time, the Dow lost 0.58%, and the tech-heavy Nasdaq gained 0.28%.
Shares of the maker of software used to test and develop chips witnessed a gain of 7.09% over the previous month, beating the performance of the Computer and Technology sector with its gain of 0.43%, and the S&P 500's gain of 0.6%.
The upcoming earnings release of Synopsys will be of great interest to investors. The company is predicted to post an EPS of $3.57, indicating a 17.82% growth compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $2.39 billion, up 64.28% from the year-ago period.
SNPS's full-year Zacks Consensus Estimates are calling for earnings of $14.39 per share and revenue of $9.63 billion. These results would represent year-over-year changes of +11.46% and +36.45%, respectively.
Investors might also notice recent changes to analyst estimates for Synopsys. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.06% downward. Currently, Synopsys is carrying a Zacks Rank of #3 (Hold).
With respect to valuation, Synopsys is currently being traded at a Forward P/E ratio of 35.4. This expresses a premium compared to the average Forward P/E of 21.77 of its industry.
It is also worth noting that SNPS currently has a PEG ratio of 2.98. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Computer - Software was holding an average PEG ratio of 1.76 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 78, which puts it in the top 32% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Synopsys, Inc. (SNPS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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