Synopsys (SNPS) closed at $279.29 in the latest trading session, marking a -0.65% move from the prior day. This change was narrower than the S&P 500’s daily loss of 1.06%. Meanwhile, the Dow lost 0.46%, and the Nasdaq, a tech-heavy index, lost 0.13%.
Prior to today’s trading, shares of the maker of software used to test and develop chips had lost 12.53% over the past month. This has lagged the Computer and Technology sector’s loss of 1.1% and the S&P 500’s gain of 4.94% in that time.
Wall Street will be looking for positivity from Synopsys as it approaches its next earnings report date. The company is expected to report EPS of $1.84, up 1.1% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $1.28 billion, up 11.01% from the year-ago period.
It is also important to note the recent changes to analyst estimates for Synopsys. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 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% lower within the past month. Synopsys is currently a Zacks Rank #4 (Sell).
Looking at its valuation, Synopsys is holding a Forward P/E ratio of 27.52. Its industry sports an average Forward P/E of 23.72, so we one might conclude that Synopsys is trading at a premium comparatively.
Investors should also note that SNPS has a PEG ratio of 1.7 right now. 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. Computer – Software stocks are, on average, holding a PEG ratio of 1.92 based on yesterday’s closing prices.
The Computer – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 139, putting it in the bottom 45% of all 250+ industries.
The Zacks Industry Rank includes is listed in order 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Synopsys, Inc. (SNPS): Free Stock Analysis Report
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