Synopsys (SNPS – Free Report) closed at $380.90 in the latest trading session, marking a -1.86% move from the prior day. This change lagged the S&P 500’s daily loss of 0.23%. At the same time, the Dow lost 0.91%, and the tech-heavy Nasdaq gained 0.1%.
Prior to today’s trading, shares of the maker of software used to test and develop chips had lost 13.92% over the past month. This has was narrower than the Computer and Technology sector’s loss of 16.18% and lagged the S&P 500’s loss of 12.13% in that time.
Investors will be eagerly watching for the performance of Synopsys in its upcoming earnings disclosure. The company is forecasted to report an EPS of $3.39, showcasing a 13% upward movement from the corresponding quarter of the prior year. Alongside, our most recent consensus estimate is anticipating revenue of $1.6 billion, indicating a 10.18% upward movement from the same quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $14.88 per share and a revenue of $6.77 billion, indicating changes of +12.73% and +8.05%, respectively, from the former year.
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. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To capitalize on this, we’ve crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Synopsys is currently a Zacks Rank #3 (Hold).
Investors should also note Synopsys’s current valuation metrics, including its Forward P/E ratio of 26.08. This expresses a premium compared to the average Forward P/E of 22.6 of its industry.
It is also worth noting that SNPS currently has a PEG ratio of 1.95. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Computer – Software industry currently had an average PEG ratio of 1.95 as of yesterday’s close.
The Computer – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 68, putting it in the top 28% of all 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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