In the latest trading session, Synopsys (SNPS) closed at $404.94, marking a -1.27% move from the previous day. The stock's performance was behind the S&P 500's daily gain of 0.62%. Meanwhile, the Dow gained 0.58%, and the Nasdaq, a tech-heavy index, added 0.83%.
The maker of software used to test and develop chips's stock has dropped by 5.27% in the past month, falling short of the Computer and Technology sector's gain of 2.41% and the S&P 500's gain of 0.8%.
Market participants will be closely following the financial results of Synopsys in its upcoming release. The company is expected to report EPS of $3.17, down 13.62% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.25 billion, up 40.29% from the prior-year quarter.
SNPS's full-year Zacks Consensus Estimates are calling for earnings of $14.43 per share and revenue of $9.62 billion. These results would represent year-over-year changes of +11.77% and +36.43%, respectively.
Investors should also note any recent changes to analyst estimates for Synopsys. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Right now, Synopsys possesses a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Synopsys has a Forward P/E ratio of 28.42 right now. Its industry sports an average Forward P/E of 15.43, so one might conclude that Synopsys is trading at a premium comparatively.
Also, we should mention that SNPS has a PEG ratio of 2.39. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. SNPS's industry had an average PEG ratio of 1.37 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 38, finds itself in the top 16% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Synopsys, Inc. (SNPS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).