• Synopsys has decreased its fiscal year (FY) revenue forecast to approximately $6.09-6.15 billion from its previous forecast of $6.57-6.63 billion.
• The company’s new adjusted EPS (Earnings Per Share) forecast stands at $12.90-12.98, which is lower than its previous forecasts of $13.47-13.55.
• Synopsys’ third quarter revenue forecast remains in the range of $1.51-1.54 billion.
• Its forecast for third quarter adjusted EPS has been placed between $3.25-$3.30.
• For the second quarter, the company achieved an adjusted EPS of $3.00, showing growth from last year’s $2.54.
• The revenue in the second quarter reached $1.45 billion, a 4.3% year-to-year increase.
• Revenue from Design Automation was above estimates at $1.05 billion.
• Design IP revenue, however, was slightly below estimates, at $399.8 million.
• The company posted an adjusted operating income of $543.0 million—an uplift of 17% from the previous year.
• Synopsys’ adjusted net income hit $466.9 million, standing slightly above estimates.
• The company presently holds cash and cash equivalents worth $1.50 billion.
• Despite cutting FY forecasts, Synopsys remains confident and has raised its full-year targets for revenue and non-GAAP EPS.
• Synopsys’ CFO, Shelagh Glaser, accredits the strong Q2 results to the team’s unwavering focus on execution, top-notch technology, and a resilient business model.
• Currently, the company has 17 buy ratings, 1 hold rating, and no sell ratings.
Synopsys Inc on Smartkarma
Analysts on Smartkarma have been providing positive coverage of Synopsys Inc (SNPS). Value Investors Club recommends SNPS as a good long-term holding, mentioning the potential divestment of the Software Integrity business to enhance overall profitability. In a report published three months ago, they highlight the strong performance of SNPS’s EDA and IP divisions with impressive adjusted operating margins exceeding 30%.
Similarly, Baptista Research‘s reports focus on SNPS’s growth and achievements. They discuss the substantial revenue increase in the first quarter of fiscal year 2024, reaching $1.65 billion, a 21% year-over-year rise, with a corresponding non-GAAP operating margin up to 38.7%. Another report praises SNPS’s stellar year, showcasing significant revenue growth to $5.84 billion, a backlog expansion, and the Software Integrity segment’s notable success.
A look at Synopsys Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 1 | |
| Growth | 4 | |
| Resilience | 4 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
With a strong Growth, Resilience, and Momentum Smart Scores, Synopsys Inc seems to be positioned for long-term success in the electronic design automation market. The company’s focus on innovation and ability to adapt to changing market conditions bodes well for future growth. While its Dividend score is lower, indicating a lower emphasis on dividend payouts, the overall outlook remains positive due to its solid performance across other key factors.
Synopsys Inc, a leading provider of electronic design automation solutions, continues to impress with high scores in Growth, Resilience, and Momentum. These scores highlight the company’s robustness, growth potential, and market momentum. Despite a lower score in Dividend, Synopsys’ innovative approach to design technologies and commitment to customer support position it well for sustained success in the competitive electronics market.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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