Synopsys, Inc. provides electronic design automation software products used to design and test integrated circuits. It operates in three segments: Design Automation, Design IP, and Software Integrity. 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; and FPGA design products that are programmed to perform specific functions. It also provides intellectual property (IP) solutions for USB, PCI Express, DDR, Ethernet, MIPI, HDMI, and Bluetooth low energy applications; logic libraries and embedded memories; processor cores, software, and application-specific instruction-set processor tools for embedded applications; security IP solutions; IP solutions for automotive market; and system-on-chip (SoC) infrastructure IP, datapath and building block IP, and verification IP products, as well as mathematical and floating-point components, and Arm AMBA interconnect fabric and peripherals. In addition, the company offers HAPS FPGA-based prototyping systems; virtual prototyping solutions; and Platform Architect solutions for SoC architecture analysis and optimization, as well as optical products, and mechatronic simulations. Further, it provides security and quality testing products, managed services, programs and professional services, and training that enable its customers to detect and remediate security vulnerabilities, and defects in the software development lifecycle, as well as manufacturing solutions. Additionally, the company provides intelligent orchestration solution, software risk manager, and black duck software composition analysis tools. It serves electronics, financial services, automotive, medicine, energy, and industrial areas. The company was incorporated in 1986 and is headquartered in Sunnyvale, California.

Synopsys, Inc.

Below is Validea's guru fundamental report for SYNOPSYS INC (SNPS). Of the 22 guru strategies we follow, SNPS rates highest using our Growth Investor model based on the published strategy of Martin Zweig. This strategy looks for growth stocks with persistent accelerating earnings and sales growth, reasonable valuations and low debt.
SYNOPSYS INC (SNPS) is a large-cap growth stock in the Software & Programming industry. The rating using this strategy is 46% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
Detailed Analysis of SYNOPSYS INC
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About Martin Zweig: During the 15 years that it was monitored, Zweig's stock recommendation newsletter returned an average of 15.9 percent per year, during which time it was ranked number one based on risk-adjusted returns by Hulbert Financial Digest. Zweig has managed both mutual and hedge funds during his career, and he's put the fortune he's compiled to some interesting uses. He has owned what Forbes reported was the most expensive apartment in New York, a $70 million penthouse that sits atop Manhattan's Pierre Hotel, and he is a collector of all sorts of pop culture and historical memorabilia -- among his purchases are the gun used by Clint Eastwood in "Dirty Harry", a stock certificate signed by Commodore Vanderbilt, and even two old-fashioned gas pumps similar to those he'd seen at a nearby gas station while growing up in Cleveland, according to published reports.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

SNPS Quantitative Stock Analysis - Martin Zweig

Martin Zweig Detailed Fundamental Analysis - SNPS

Synopsys (SNPS) closed at $464.40 in the latest trading session, marking a +1.82% move from the prior day. The stock's performance was ahead of the S&P 500's daily gain of 0.79%. Elsewhere, the Dow gained 1.01%, while the tech-heavy Nasdaq added 1.15%.
The maker of software used to test and develop chips's shares have seen a decrease of 6.39% over the last month, not keeping up with the Computer and Technology sector's gain of 1.2% and the S&P 500's gain of 1.27%.
Investors will be eagerly watching for the performance of Synopsys in its upcoming earnings disclosure. The company is predicted to post an EPS of $2.79, indicating a 17.94% decline compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $2.25 billion, up 37.59% from the year-ago period.
SNPS's full-year Zacks Consensus Estimates are calling for earnings of $12.83 per share and revenue of $7.05 billion. These results would represent year-over-year changes of -2.8% and +12.52%, respectively.
Investors should also note any recent changes to analyst estimates for Synopsys. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. As of now, Synopsys holds a Zacks Rank of #5 (Strong Sell).
Investors should also note Synopsys's current valuation metrics, including its Forward P/E ratio of 35.54. This expresses a premium compared to the average Forward P/E of 29.24 of its industry.
We can additionally observe that SNPS currently boasts a PEG ratio of 3.13. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Computer - Software industry was having an average PEG ratio of 2.11.
The Computer - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 84, placing it within the top 35% of over 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Synopsys (SNPS) Outperforms Broader Market: What You Need to Know

Synopsys SNPS and Marvell Technology MRVL are two leading players in the AI Cluster and Data Center interconnect market. Per a report by MarketsAndMarkets, the data center interconnect market is projected to reach $25.89 billion in 2030 from $15.38 billion in 2025, witnessing a CAGR of 11%.
Both SNPS and MRVL have the potential to capitalize on this industry momentum. With this strong industry outlook, the question remains: Which stock has more upside potential? Let’s break down their fundamentals, growth prospects and market challenges for both SNPS and MRVL.
The Case for SNPS Stock
Synopsys is capturing the AI cluster interconnect market with product launches, including Ultra Accelerator Link and Ultra Ethernet IP solutions. The UALink IP solution offers a throughput of 200 Gbps per lane, which means SNPS’ customers can now scale up to 1,024 AI accelerator links fast and enjoy low latency, high bandwidth, and advanced memory sharing features.
Synopsys’ Ultra Ethernet IP, on the other hand, is focused on helping SNPS’ customers to build AI scale-out networks by connecting millions of nodes and using MAC and PCS controllers, PHY, and verification IP. These products will maximise bandwidth at data rates up to 1.6 terabytes per second.
With all these offerings in its portfolio, SNPS is set to capitalize on the growing HPC and AI market, which requires high-speed, low-latency interconnects to link accelerator clusters. Synopsys is well-positioned to benefit through its Ultra Ethernet and UALink IP solutions as it deploys them in combination with its established EDA tools, PCIe, and Ethernet IP interconnect technologies.
However, SNPS faces competitive pressure from the Ultra Ethernet Consortium and companies like Broadcom and Marvell Technology. Some of these rivals have the capability to vertically integrate their chips and network to reduce reliance on third-party IP. SNPS’ Design IP business also declined 8% year over year due to foundry customer delays and internal resource allocation missteps.
These factors contributed to affecting both top and bottom lines and the company’s faiure to meet analysts’ expectations in the third quarter of fiscal 2025. The Zacks Consensus Estimate for SNPS’ fiscal 2025 earnings is pegged at $12.8 billion, indicating a year-over-year decline of 2.8%.
Image Source: Zacks Investment Research
The Case for MRVL Stock
Marvell Technology is an established player in the data center connectivity market with its extensive portfolio of products like Active Copper Cable Linear Equalizers, Digital Signal Processors, Active Electrical Cables, ethernet switch and co-packaged optics as AI workloads demand faster connectivity.
The company is now entering into the data center interconnect market with COLORZ 800G ZR/ZR+ for Multi-Site AI Training, which is the first of its kind 800 Gbps ZR/ZR+ coherent pluggable optical module for providing scalable and cost-optimized transmission up to 2,000km. As MRVL included the COLORZ 800G ZR/ZR+ module in its portfolio, it will give a boost to its networking and carrier infrastructure segments’ top-line growth.
Marvell Technology’s enterprise networking and carrier infrastructure segments are also showing strong recovery. In the second quarter of fiscal 2026, enterprise networking revenues climbed 28% year over year to $194 million, while carrier infrastructure grew 71% to $130 million.
These factors will contribute to MRVL’s top-line growth. Marvell Technology initiated strong revenue guidance for the third quarter. It expects revenues to be $2.06 billion (+/- 5%). The Zacks Consensus Estimate for Marvell Technology’s third-quarter fiscal 2026 revenues is pegged at $2.06 billion, indicating year-over-year growth of 35.9%.
The Zacks Consensus Estimate for Marvell Technology’s fiscal 2026 and 2027 earnings implies year-over-year growth of 78.3% and 19.2%, respectively
Image Source: Zacks Investment Research
Stock Price Performance and Valuation of MRVL and SNPS
Year to date, Marvell Technology shares have plunged 25.1% and SNPS stock has lost 6%.
Image Source: Zacks Investment Research
MRVL is trading at a forward sales multiple of 7.88X, way above its median of 7.40X, over the past year. SNPS’ forward sales multiple sits at 8.76X, significantly below its median of 11.04X over the past year.
Image Source: Zacks Investment Research
Conclusion: MRVL vs. SNPS Stock
Although both Marvell Technology and Synopsys are set to capitalize on the data center interconnect market, weakness in SNPS’ Design IP business, rising competition and shrinking margins make it less attractive compared to MRVL, which now has the capability to vertically integrate its chips and network to reduce reliance on third-party IP providers like SNPS.
Marvell Technology also carries a Zacks Rank #3 (Hold) compared to SNPS’ Zacks Rank #5 (Strong Sell), giving it an edge over the latter at present.
Zacks Names #1 Semiconductor Stock
This under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.
See This Stock Now for Free >>
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

SNPS vs. MRVL: Which Stock Has an Edge in the Interconnect Market?

Guru Fundamental Report for SNPS - Martin Zweig

Synopsys SNPS stock has lost 25.3% in the past three months, underperforming the Zacks Computer - Software industry’s return of 1.4%. This sharp decline in the share price of this EDA vendor raises the question: Should investors hold on or exit the stock?
SNPS YTD Performance Chart
Image Source: Zacks Investment Research
Let’s break down the fundamentals, growth prospects, market challenges and valuation to determine if SNPS offers an investment opportunity right now or is it a risky bet?
SNPS Pushes Into the AI-based EDA Products to Drive Growth
Synopsys’ AI-driven electronic design automation (EDA) tools like Synopsys.ai, Fusion Compiler, PrimeTime, IC Validator, and StarRC are being rapidly adopted as customers are experiencing massive productivity gains from their implementation.
Synopsys is also expanding in the AI cluster interconnect market with launches, including Ultra Accelerator Link and Ultra Ethernet IP solutions, and it’s expected to benefit from the expanding Data Center Interconnect market, which is projected to reach $25.89 billion by 2030, witnessing an 11% CAGR from 2025 to 2030, per a report by MarketsAndMarkets.
Numerous companies have selected Synopsys as their primary EDA partner. Relationships with companies, such as Advanced Micro Devices, Juniper Networks, Realtek, Teradici, NetLogic Microsystems, Toshiba and Wolfson stand as evidence. AI-chip developers are implementing the ZeBu Server 4 design emulation system for speeding up their System-on-Chip verification.
Synopsys’ software-based verification tools are gaining traction at both traditional semiconductor and emerging system companies. Since advanced nodes require precise verification, sign-off, and simulation, directly boosting software demand and licensing revenues, many companies are adopting SNPS’ EDA products.
With all these offerings in its portfolio, SNPS is set to capitalize on the growing HPC and AI market, which requires high-speed, low-latency interconnects to link accelerator clusters. The Zacks Consensus Estimate for SNPS’ fiscal 2025 revenues is pegged at $7.05 billion, indicating year-over-year growth of 12.5%.
SNPS Faces Competitive Challenges in Networking and EDA Space
SNPS faces a major threat from the Ultra Ethernet Consortium and companies like Broadcom AVGO and Marvell Technology MRVL. Synopsys also faces competition from EDA vendors, such as Cadence Design Systems Inc. CDNS and Siemens.
Broadcom develops networking ASICs, Ethernet switches, and PHYs that dominate data centers. Broadcom also builds custom silicon for hyperscalers like Google and Meta, proving that the company has a deep, in-house interconnect IP and is not reliant on third-party IPs from Synopsys.
Cadence Design System provides EDA tools, such as software, hardware, and services, essential for designing chips and semiconductor devices. Cadence offers products focused on distinct phases of the IC design process and provides a range of services to companies worldwide to help optimize their product development process, among other things.
Similarly, Marvell Technology develops custom ASICs, DPU/NIC chips, and SerDes PHY IP used in AI and HPC interconnects. Marvell Technology provides integrated interconnect and compute chips to hyperscalers. Marvell Technology’s co-packaged optics and chiplet interconnect technology directly challenge Synopsys in the interconnect market.
The presence of stiff competition due to these players is forcing SNPS to increase its Marketing and Research expenses to stay ahead, resulting in margin compression. The Zacks Consensus Estimate for SNPS’ fiscal 2025 earnings is pegged at $12.8 billion, indicating a year-over-year decline of 2.8%.
Image Source: Zacks Investment Research
SNPS Faces Challenges in Design IP Business
SNPS’ Design IP business declined 8% year over year due to foundry customer delays and internal resource allocation missteps. On theearnings call management noted a “muted year” ahead for Design IP, signaling sustained pressure into fiscal 2026.
Synopsys is facing pressure on its operating margins due to weakness in its Design IP business. Synopsys also remains exposed to geopolitical risks, particularly in China, which continue to weigh on its business outlook.
Compounding the issue, management warned of a compression in margins in the fourth quarter. Management also stated that additional debt to finance the Ansys acquisition would weigh on free cash flow. These factors cast doubt on Synopsys’ near-term growth and profitability trajectory.
SNPS Shares are Overvalued at Present
SNPS is currently trading at a premium valuation, with its forward 12-month price-to-sales (P/S) ratio at 8.83X, which is higher than the Zacks Computer - Software industry’s average of 8.54X. This is also reflected in the Zacks Value Score of the stock, as it carries a Value Score of F.
SNPS Forward 12 Months (P/S) Valuation Chart
Image Source: Zacks Investment Research
Conclusion: Sell SNPS Stock Now
Although SNPS is investing heavily in the AI-based EDA and AI-cluster interconnect solutions, its lofty valuation, declining margins, rising competition and muted Design IP business are major headwinds, which might dissuade investors. Considering all these factors, we suggest investors stay away from this Zacks Rank #5 (Strong Sell) stock.
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SNPS Stock Plunges 25% in 3 Months: Should You Buy, Sell or Hold?

SNPS Factor-Based Stock Analysis - Martin Zweig

In the latest close session, Synopsys (SNPS) was up +1.28% at $453.35. The stock outpaced the S&P 500's daily gain of 1.07%. Elsewhere, the Dow gained 1.12%, while the tech-heavy Nasdaq added 1.37%.
Shares of the maker of software used to test and develop chips witnessed a loss of 9.66% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 2.68%, and the S&P 500's gain of 1.08%.
Analysts and investors alike will be keeping a close eye on the performance of Synopsys in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $2.79, marking a 17.94% fall compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $2.25 billion, showing a 37.59% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $12.83 per share and revenue of $7.05 billion. These totals would mark changes of -2.8% and +12.52%, respectively, from last year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Synopsys. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.09% higher within the past month. As of now, Synopsys holds a Zacks Rank of #5 (Strong Sell).
Digging into valuation, Synopsys currently has a Forward P/E ratio of 34.88. For comparison, its industry has an average Forward P/E of 27.14, which means Synopsys is trading at a premium to the group.
We can also see that SNPS currently has a PEG ratio of 3.07. 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. The average PEG ratio for the Computer - Software industry stood at 2.07 at the close of the market yesterday.
The Computer - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 151, this industry ranks in the bottom 39% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Indicator	TTM Median
P/E	35.12 28.98
Price/Sales	12.19 2.58
P/B	7.60 2.76
P/FCF	65.38 24.31

Indicator	TTM Median
ROE	24.08 15.33
ROA	14.06 6.66
ROI	18.81 9.73
Net Worth	71.65 0.98
Quick Ratio	6.85 1.53
Current Ratio	7.02 1.84

Indicator	TTM Median
Net Profit Margin	34.77 9.71
Operating Margin	20.88 11.07
Gross Margin	79.84 50.00
Return on tangible equity	40.57 27.59

Indicator	TTM Median
EPS	2.59 0.24
EPS Forecast	2.40 0.19
Revenue	1.60B 73.00M
Gross Profit	1.29B —
EBITDA	441.00M —

Synopsys, Inc.

TTM metrics for the latest quarter under IFRS and their historical dynamics

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Revenue