Synopsys Inc. (SNPS)
Technology · NASDAQ · US
Fundamentals
Valuation and ratings
Synopsys Inc. trades at $417.03, which is 57% above the $178.20 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 62 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 101.9 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Synopsys Inc.
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; Verification solution that offers virtual prototyping, static and formal verification, simulation, emulation, field programmable gate array (FPGA)-based prototyping, and debug solutions; FPGA design products that are programmed to perform specific functions; synopsys technology computer-aided design (TCAD), mask synthesis, and manufacturing analytic solutions; and AI-driven EDA solutions. It also provides pre-verified and silicon-proven IP solutions, logic libraries and embedded memories, processor and security solutions, IP Offerings for the automotive market, SOC infrastructure IP, data path and building block IP, and mathematical and floating-point components. Synopsys, Inc. has a strategic collaboration with Arm Holdings plc for development of AGI CPU that provides solutions across its full-stack design portfolio including EDA, interface IP, and hardware-assisted verification (HAV). The company was incorporated in 1986 and is headquartered in Sunnyvale, California.
SNPS passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
22 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Capital Research Global, Capital Research Global Investors$817.81M · 0.1% of book
- Parnassus Investments, PARNASSUS INVESTMENTS, LLC$579.03M · 1.7% of book
- Farallon Capital, FARALLON CAPITAL MANAGEMENT, L.L.C.$481.05M · 2.7% of book
- Philippe Laffont, COATUE MANAGEMENT LLC$302.02M · 1.0% of book
- Polen Capital, POLEN CAPITAL MANAGEMENT LLC$266.13M · 1.8% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Synopsys Inc. (SNPS) undervalued?
Against our discounted cash flow estimate of $178.20, SNPS at $417.03 is 57% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own SNPS?
22 of the institutions we track reported a position in SNPS in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is SNPS's P/E ratio?
SNPS trades at 101.9 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for SNPS, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.