SNPS

Synopsys, Inc.

$447.62

-1.53% 2026-10-20

Information TechnologyS&P 500

1M 3M 6M 1Y 2Y

SNPSSPY

-9.5%

+16.3%

+15.0%

-4.3%

YTD

-4.7%

-1.3%

Live chart

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What they do

Synopsys, Inc. provides design IP solutions in the semiconductor and electronics industries. It operates in two segments, Design Automation and Design IP. The company offers Digital and Custom IC Design solution that provides digital design implementation solutions.

Technology · Software - Infrastructure

Grades vs sector

Momentum

34th pct in sector

C-

12-1 return: -4.2%
Percentile within its GICS sector across the S&P 1500.

Growth

87th pct in sector

A-

Revenue growth (YoY): +42.4%
Percentile within its GICS sector across the S&P 1500.

Value

22nd pct in sector

Forward E/P: 4.1% · EBITDA/EV: 2.2%
Percentile within its GICS sector across the S&P 1500.

Profitability

37th pct in sector

C-

Profit margin: +11.4% · Return on equity: +3.7%
Percentile within its GICS sector across the S&P 1500.

Revisions

Not enough data yet

–

EPS estimate change, 30 days (current FY): –
30-day change in analysts' current-year EPS estimate; graded across covered stocks.

Our models

Held by 1 of 5 live models: Conviction 20.

Conviction 20

6.2% of the book · Core sleeve

Held Quality Growth

not ranked (outside this model's universe or screens)

Momentum Top 15

rank 402 of 499 · 12-1 momentum % -10.9

Momentum Blend

not in the current book

New Highs Growth

not ranked (outside this model's universe or screens)

Why it's in Conviction 20

Picked for this research portfolio at the 2026-10-21 close (Core group, AI).

What would knock it out: Weights are fixed and there is no rebalance rule. Any change would be dated and shown here.

News

More news

Synopsys Undervalued as Market Overlooks AI Revenue Opportunity, Morgan Stanley Says

MT Newswires · Oct 20

Morgan Stanley Adjusts Synopsys Price Target to $574 From $500, Maintains Overweight Rating

MT Newswires · Oct 20

Morgan Stanley Adjusts Synopsys Price Target to $574 From $500

MT Newswires · Oct 20

Did Cadence's Industry Carry Its Stock?

Trefis · Oct 20

Intel upgraded, PayPal downgraded: Wall Street's top analyst calls

The Fly · Oct 19

Key stats

Market cap$85.8B

P/E (trailing)79.1

P/E (forward)23.9

52-week range362.55 – 539.48

Revenue growth (YoY, latest qtr)+42.4%

Dividend yield0.00%

Analyst consensusStrong Buy (25)

Mean price target$586.95 (+31%)

Valuation and fundamentals

Valuation & fundamentals

Bottom line

Leans undervalued

Model read-out from the numbers below, not advice. Score +1 (DCF counts double).

▲DCF (base case)above the price by 62%

▼Forward P/E vs sector23.9x vs median 16.9x

▼Piotroski F-score3/9

▲Altman Z3.7 (safe)

•Net debt / EBITDA2.5x

▲Analyst target+31% (25 analysts)

Discounted cash flow

Bear

$317

-29%

growth 17% · disc. 11.3% · term. 2.0%

Base

$724

+62%

growth 29% · disc. 10.3% · term. 2.5%

Bull

$1,333

+198%

growth 36% · disc. 9.3% · term. 3.0%

A DCF starts from trailing free cash flow, so it can overstate value if the last 12 months were unusually strong (or weak). Use the bear case or edit the starting cash flow if so.

Reverse DCFfor context, not a signal

Today's price assumes free cash flow grows about 15% a year for 10 years.

Implied

+15%/yr

FCF, last 3 yrs

-6%/yr

FCF, last 5 yrs

+10%/yr

Revenue, last 3 yrs

+15%/yr

Revenue, last 5 yrs

+14%/yr

Same inputs as the DCF above: trailing free cash flow 2.7B, 10.3% discount rate, 2.5% growth after year 10, net debt and today's share count. Actual growth rates are compound annual rates from SEC annual filings through FY2025; "n/a" means too little history or a negative starting year.

Edit assumptions · recalculates instantly

Your value per share–

Free cash flow = operating cash flow − capital spending, trailing 12 months (TTM to 2026-07-31). Growth default: average of 3-year revenue CAGR and latest revenue growth, capped at 30%. Years 6–10 fade linearly to terminal growth. Discount rate = 4.25% risk-free assumption + beta 1.21 × 5% equity premium, kept within 7–13%. Bear: lower growth, +1 pt discount, 2% terminal. Bull: higher growth, −1 pt, 3%.

Multiples vs Information Technology

P/E (trailing)

sector median 35.9× · 84th pct

79.1×
pricier

Forward P/E

sector median 16.9× · 73rd pct

23.9×
pricier

EV / EBITDA

sector median 20.8× · 75th pct

35.3×
pricier

Price / sales

sector median 4.6× · 75th pct

9.1×
pricier

Price / book

sector median 5.1× · 25th pct

2.8×
cheaper

FCF yield

sector median 3.5% · 48th pct

3.2%
pricier

Forward EPS $18.73 vs trailing $5.66 (+231% expected growth). Forward P/E uses analysts' next-12-month estimate.

Backlog (remaining performance obligations)

RPO

$10.9B

as of 2026-07-31

vs a year ago

+8%

YoY

× TTM revenue

1.16×

coverage

24-10

25-01

25-04

25-07

25-10

26-01

26-04

26-07

Contracted revenue not yet recognized, from SEC filings (XBRL tag RevenueRemainingPerformanceObligation).

Quality & financial health

Gross margin

72.4%

Operating margin

8.5%

FCF margin

29.2%

Net margin

11.4%

Return on equity

3.5%

Return on invested capital

1.8%

Net debt / EBITDA

2.5×

Current ratio

1.3×

Interest cover

1.3×

Cash conversion (OCF/NI)

2.7×

Piotroski F-score 3/9 · last two fiscal years

✓ Positive net income✓ Positive operating cash flow✗ Return on assets improved✓ Cash flow above net income✗ Long-term debt / assets fell✗ Current ratio improved✗ No share dilution✗ Gross margin improved✗ Asset turnover improved

Altman Z-score 3.7 (safe zone; above 3.0 = safe, below 1.8 = distress). Not meaningful for banks and insurers.

Analysts

Mean target

$587

+31%

Analysts

Strong Buy

Range

$475–$700

low – high

● price · ◆ mean target

Annual history

FY	Revenue	Net income	Free cash flow
2025	$7.1B	$1.3B	$1.3B
2024	$6.1B	$2.3B	$1.3B
2023	$5.3B	$1.2B	$1.5B
2022	$4.6B	$984.6M	$1.6B
2021	$4.2B	$757.5M	$1.4B
2020	$3.7B	$664.3M	$836.6M

From the company's 10-K filings via SEC XBRL. 3-year revenue CAGR +15.2%.

Earnings

Next report: 2026-12-09 · during market · EPS est 4.13

EstimateActual (beat)Actual (miss)

Report	EPS est	Actual	Surprise
2026-08-26	3.67	3.91	+6.4%
2026-05-27	3.16	3.35	+6.0%
2026-02-25	3.56	3.77	+6.0%
2025-12-10	2.78	2.90	+4.2%
2025-09-09	3.75	3.39	-9.5%
2025-05-28	3.40	3.67	+8.0%
2025-02-26	2.79	3.03	+8.6%
2024-12-04	3.30	3.40	+3.0%

Quarterly revenue

Quarter	Revenue	YoY
2026-07-31	$2.5B	+42.4%
2026-04-30	$2.3B	–
2026-01-31	$2.4B	–
2025-10-31	$2.3B	–
2025-07-31	$1.7B	–

Analyst actions

Morgan Stanley

2026-10-20 · main

Overweight → Overweight
PT $574

Needham

2026-10-12 · main

Buy → Buy
PT $620

Wells Fargo

2026-10-01 · main

Overweight → Overweight
PT $540

Keybanc

2026-10-01 · main

Overweight → Overweight
PT $605

Rosenblatt

2026-10-01 · main

Buy → Buy
PT $620

HSBC

2026-09-25 · up

Hold → Buy
PT $700

Insider trades

Ghazi Sassine

Director, PRESIDENT AND CEO · 2026-10-15

SELL
$6.8M

Lee Janet

GC & Corporate Secretary · 2026-10-06

SELL
$293.3K

Lee Janet

GC & Corporate Secretary · 2026-10-06

SELL
$281.3K

Kankanwadi Sudhindra

Deputy CFO & CAO · 2026-10-06

SELL
$4.6M

Kankanwadi Sudhindra

Deputy CFO & CAO · 2026-10-05

SELL
$1.5M

Ghazi Sassine

Director, PRESIDENT AND CEO · 2026-09-15

SELL
$5.5M

De Geus Aart

Director, EXECUTIVE CHAIR · 2026-09-01

SELL
$10.3M

De Geus Aart

Director, EXECUTIVE CHAIR · 2026-08-31

SELL
$11.0M

De Geus Aart

Director, EXECUTIVE CHAIR · 2026-08-28

SELL
$11.1M

None

None · None

SELL
–

None

None · None

SELL
–

None

None · None

SELL
–

Stats refreshed 2026-10-20 17:52:14 ET from Yahoo Finance (yfinance). "–" means the data isn't available. Refresh now

COTEAU

Coteau Systematic Strategies publishes stock research and model portfolios. It doesn't manage money or give investment advice. Results are hypothetical unless marked Live. Data: Yahoo Finance (delayed) and SEC EDGAR.

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