In the latest trading session, Synopsys (SNPS) closed at $536.52, marking a -2.23% move from the previous day. The stock trailed the S&P 500, which registered a daily loss of 0.79%. Elsewhere, the Dow saw a downswing of 0.94%, while the tech-heavy Nasdaq depreciated by 0.92%.
The stock of maker of software used to test and develop chips has risen by 12.91% in the past month, leading the Computer and Technology sector's gain of 7.88% and the S&P 500's gain of 5.22%.
Investors will be eagerly watching for the performance of Synopsys in its upcoming earnings disclosure. The company's upcoming EPS is projected at $3.84, signifying a 11.95% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $1.77 billion, up 16% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $15.09 per share and revenue of $6.77 billion, indicating changes of +14.32% and +8.08%, respectively, compared to the previous year.
Investors should also note any recent changes to analyst estimates for Synopsys. These revisions help to show the ever-changing nature of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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 remained steady. Synopsys is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, Synopsys is holding a Forward P/E ratio of 36.35. This expresses a premium compared to the average Forward P/E of 27.59 of its industry.
It is also worth noting that SNPS currently has a PEG ratio of 2.6. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. SNPS's industry had an average PEG ratio of 2.41 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 42, finds itself in the top 18% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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