Synopsys (SNPS) closed the latest trading day at $517.66, indicating a +0.38% change from the previous session's end. The stock outperformed the S&P 500, which registered a daily gain of 0.1%. Meanwhile, the Dow lost 0.21%, and the Nasdaq, a tech-heavy index, added 0.72%.
Coming into today, shares of the maker of software used to test and develop chips had gained 21.16% in the past month. In that same time, the Computer and Technology sector gained 14.29%, while the S&P 500 gained 9.86%.
Analysts and investors alike will be keeping a close eye on the performance of Synopsys in its upcoming earnings disclosure. The company's earnings report is set to go public on May 28, 2025. The company is expected to report EPS of $3.39, up 13% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $1.6 billion, indicating a 10.1% growth compared to the corresponding quarter of the prior year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $14.88 per share and revenue of $6.77 billion, indicating changes of +12.73% and +7.98%, respectively, compared to the previous year.
Investors should also take note of any recent adjustments to analyst estimates for Synopsys. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.03% lower. Synopsys currently has a Zacks Rank of #3 (Hold).
Digging into valuation, Synopsys currently has a Forward P/E ratio of 34.67. This represents a premium compared to its industry's average Forward P/E of 28.02.
Also, we should mention that SNPS has a PEG ratio of 2.63. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SNPS's industry had an average PEG ratio of 2.37 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 66, positioning it in the top 27% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the 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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Synopsys, Inc. (SNPS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
