Synopsys: Provides A Good Haven During Market Downturns

Aug. 05, 2022 6:31 PM ETSynopsys, Inc. (SNPS) Stock, , , , , 7 Comments

Summary

  • We believe SNPS is a buy. The company operates primarily within Electronic Design Automation ((EDA)), an industry forecasted to grow at a CAGR of 9.6% between 2020-2027.
  • We believe SNPS provides a favorable risk reward because most of its revenue is from its EDA business which is highly resilient in all kinds of markets.
  • We believe SNPS' EDA business efforts for new chip design could potentially ease the semiconductor slowdown.
  • SNPS' customer base is expanding, with more technology companies shifting to designing chips in-house.
  • SNPS is not overly cheap, trading at a P/E of around 43x C2023 EPS, $9.85 compared to the peer group average of 76x.

Synopsys World Headquarters, Mountain View, CA

jejim

We are buy-rated on Synopsys, Inc. (NASDAQ:SNPS). Our bullish thesis is because we believe SNPS is well-positioned in the Electronic Design Automation (EDA) industry. SNPS provides software, hardware tools, and services aimed at one goal: designing and manufacturing advanced semiconductors. We like SNPS because

This article was written by

10.72K Followers

Tech Stock Pros is a team of three former technology sector engineers with a long history of investing in the tech sector.

They run Tech Contrarians, an investing group providing institutional-level company research to individual investors. Utilizing a live portfolio with quarterly updates, bi-weekly newsletters, and answering questions daily via chat, Tech Stock Pros aims to demystify investing in the technology sector. Learn more.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

About SNPS Stock

SymbolLast Price% Chg
Market Cap
PE
Yield
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on SNPS

Related Stocks

SymbolLast Price% Chg
SNPS
--