Synopsys Inc (SNPS)
Information Technology · Application Software · US stock · S&P 500 component
$422.48
▼ -28.71 (6.36%)
Fair valueFair
$457 +8.2% to fair value
$229fair band $389–$554$686
Day's range
$422.11 – $444.05
52-week range
$362.55 – $539.48
Red flags⚠ Heavy dilution⚠ Heavy dilution⚠ Heavy dilution⚠ Heavy dilution⚠ Heavy dilution
About Synopsys Inc
Chip designers rely on software and intellectual property from Synopsys to design electronic chips and systems. Its tools cover chip design and verification, and it licenses ready-made design blocks, such as interface and memory components, that chipmakers reuse in their products. Through its combination with Ansys, it also offers engineering simulation software. Customers include semiconductor companies, electronics makers, cloud operators and carmakers.
Software licences and subscriptions, recurring maintenance and the licensing of design blocks generated revenue of $9.4 billion over the last twelve months. Revenue has grown at 11.6% a year across the last three years. The operating margin is 8.5%, the business earns 2% on the capital invested in it, and net debt is 2.8 times EBITDA. No dividend is paid. On the site's X-Ray Score it receives 33 out of 100.
Price chart
52-wk range $362.55 – $539.48Volume 2,587,441Daily, split-adjusted
Vitals
Market cap$81.3B
52-week range$362.55 – $539.48
Volume (last day)2,587,441
P/E (TTM)72.7
EBIT / EV yield0.9%
Free-cash-flow yield3.4%
Dividend yieldNo dividend
Revenue (TTM)$9.4B
Net income (TTM)$1.1B
Operating margin8.5%
Return on capital1.7%
Debt incl. leases$10.8B
Cash & securities$3.6B
Debt = borrowings plus lease liabilities. Cash & securities = cash, equivalents and short-term marketable securities (long-term securities are not counted, so net cash can be understated for companies that hold large long-term investments). Net debt = debt minus cash & securities. Source: latest SEC 10-Q/10-K. EBIT / EV yield = operating profit divided by market cap plus net debt.
Fair value estimate
$457middle half of models $433 – $507
Fair
+8.2% to fair value
Average of the 9 valuation models that pass our checks: multiples, discounted cash flow, dividend discount and earnings power value. A model more than 100% above or 60% below the price is left out as unrealistic. Model uncertainty is Medium, based on how far apart the models are. Undervalued or Overvalued means the gap to fair value is more than 17.5%.
Price $422
Undervalued < $389Fair $389 – $554Overvalued > $554
P/E multiple
$408
P/B multiple · not used
$1,074
P/S multiple
$463
EV/EBITDA multiple
$433
EV/EBIT multiple
$272
EV/revenue multiple
$445
10-year DCF, EBITDA exit
$507
5-year DCF, EBITDA exit
$546
10-year DCF, revenue exit
$503
5-year DCF, revenue exit
$538
10-year DCF, growth exit · not used
$104
5-year DCF, growth exit · not used
$62
Earnings power value · not used
$66
A model estimate, not a price target or recommendation. Inputs: risk-free 5.13%, equity risk premium 4.30% (Damodaran). How it works.
What this means
Weak business, fairly priced
The price sits inside our fair-value band. A high score does not guarantee a good outcome; it shifts the odds a little. Use the checklist as a prompt for your own research.
Before you invest · decision checklist
Ticked boxes are filled in from our data; the rest are yours to answer.
The five-lens scan
Every score explained in one sentence, ranked against Information Technology peers. Open a lens to see the numbers behind it.
Strong: 70 to 100Fair: 50 to 69Weak: under 50No score: not enough data
Valuation
Fair
50/100
Priced about in line with its sector.
See the numbers →
EBIT / EV yield0.9%
Free-cash-flow yield3.4%
Fair value vs price1.1×
Growth
Weak
45/100
Growing slower than most of its sector.
See the numbers →
Revenue growth (3y)11.6%
EPS growth (3y)8.5%
Growth consistency90%
Profitability
Weak
21/100
Earns lower returns on its capital than most peers.
See the numbers →
Return on invested capital1.7%
Operating margin8.5%
Gross profitability14.3%
Financial health
Weak
16/100
Balance sheet is more stretched than most peers.
See the numbers →
Piotroski F-Score3 / 9
Net debt / EBITDA2.8×
Interest cover1.3×
Dividends
None
–/100
Pays no dividend.
See the numbers →
Quarterly results: last 6 quarters
+10.3%
Apr '25
+14.0%
Jul '25
+37.8%
Oct '25
+65.5%
Jan '26
+41.9%
Apr '26
+42.4%
Jul '26
Revenue against the same quarter a year earlier. Latest quarter revenue $2.5B, diluted EPS $2.84.
Compare with peers
ADBE Adobe Inc.77 INTU Intuit Inc.71 FICO Fair Isaac Corp71 ADSK Autodesk, Inc.67Other Application Software companies by X-Ray Score.
SWOT analysis: Synopsys Inc
Strengthsinside the company
- Revenue has grown 11.6% a year over three years (median 12.9% for industry peers).
Weaknessesinside the company
- Return on invested capital is only 1.7% (median 21.0% for industry peers), so the business earns little above its cost of capital.
- Operating margin of 8.5% is thin against 27.4% for industry peers.
- Operating profit covers interest only 1.3x.
- Passes only 3 of the 9 Piotroski tests, which shows weak or worsening financial trends.
Opportunitiesvaluation and setting
- Our Market Compass rates the backdrop for Information Technology as favourable.
Threatsvaluation and setting
- Trades at 75.5x earnings, 171% above the 27.8x median of industry peers, so the price already assumes better results.
- Our checks raised: Heavy dilution; Heavy dilution.
Written by fixed rules from the figures on this page and the peer table below: filings, our fair value, the sector climate and the price trend. It summarises the data, it is not a forecast or advice.
Compare SNPS with peers and sector
Medians of 13 Application Software peers and of 74 Information Technology stocks in our universe.
Largest peers (X-Ray Score): PLTR 63, ORCL 56, CRM 52, ADBE 77, INTU 71, DDOG 50.
| Metric | SNPS | Peers | Sector |
|---|---|---|---|
| X-Ray Score (out of 100) | 33 | 58 | 50 |
| Valuation | 50 | 67 | 52 |
| Growth | 45 | 65 | 54 |
| Profitability | 21 | 62 | 50 |
| Financial health | 16 | 50 | 50 |
| Dividends | – | 72 | 50 |
Sector leaders: highest X-Ray Score in Information Technology
SNPS ranks #67 of 75 in Information Technology and #14 of 14 in Application Software by X-Ray Score. A higher score is stronger on our five pillars; it is a ranking of facts, not a forecast.
Green means better than the peer median, red worse (only where a higher or lower figure is clearly better). A dash means too few companies report the figure. P/E, EV/EBITDA and price changes are not graded: a different level is not good or bad by itself.
Factor ratings for SNPS
Each factor is rated by where SNPS stands among the 75 Information Technology stocks in our universe.
Rating against the sector
Goodthe top third of these stocks
Averagethe middle third of these stocks
Badthe bottom third of these stocks
"Beats" is the share of those stocks it is ahead of.
Against its own history
The last columns set today's figure against the company's own median of its last five financial years:
▲ Betterbetter than its usual level
▼ Worseworse than its usual level
≈ In linewithin its usual range
For valuation factors Good means cheaper than most of the sector and Better means cheaper than usual for this company, which is not the same as a bargain.
In total: 5 Good · 9 Average · 9 Bad of 23
Growth: 0 · 3 · 0
Profitability: 1 · 1 · 3
Financial strength: 0 · 1 · 3
Valuation: 1 · 2 · 2
Cash flow: 1 · 2 · 1
Efficiency: 2 · 0 · 0
| Factor | SNPS | Rating | Sector median | Own 5-year median | Against own history |
|---|---|---|---|---|---|
| Growth | |||||
| Revenue growth, 3 years a year | +11.6% | Average beats 61% | +9.7% | – | – |
| Revenue growth, last year | +15.1% | Average beats 57% | +13.7% | +15.1% | ≈ In line |
| EPS growth, 3 years a year | +8.5% | Average beats 55% | +5.9% | – | – |
| Profitability | |||||
| Gross margin | 72.4% | Good beats 77% | 57.8% | 79.5% | ≈ In line |
| Operating margin | 8.5% | Bad beats 18% | 20.3% | 22.1% | ▼ Worse |
| Net margin | 11.4% | Average beats 35% | 17.8% | 19.4% | ▼ Worse |
| Return on invested capital | 1.7% | Bad beats 3% | 19.4% | – | – |
| Return on equity | 3.5% | Bad beats 8% | 21.0% | 17.9% | ▼ Worse |
| Financial strength | |||||
| Net debt / EBITDA | 2.8x | Bad beats 12% | 0.8x | -1.1x | ▼ Worse |
| Interest cover | 1.3x | Bad beats 3% | 23.0x | 50.0x | ▼ Worse |
| Current ratio | 1.34 | Average beats 41% | 1.57 | 1.16 | ▲ Better |
| Piotroski F-score | 3 / 9 | Bad beats 3% | 6 / 9 | – | – |
| Valuation | |||||
| P/E ratio | 75.5x | Bad beats 15% | 33.6x | 56.4x | ▼ Worse |
| Price / book | 2.6x | Good beats 92% | 8.3x | 8.9x | ▲ Better |
| Price / sales | 8.6x | Average beats 37% | 6.9x | 12.5x | ▲ Better |
| EV / EBITDA | 33.9x | Bad beats 32% | 24.7x | 46.9x | ▲ Better |
| Free cash flow yield | 3.4% | Average beats 51% | 3.4% | 2.1% | ▲ Better |
| Cash flow | |||||
| Free cash flow margin | 29.2% | Average beats 66% | 22.3% | 28.5% | ≈ In line |
| Cash from operations / net income | 2.73 | Good beats 91% | 1.39 | 1.38 | ▲ Better |
| Free cash flow growth, 3 years a year | −5.6% | Bad beats 9% | +15.4% | – | – |
| Accruals (lower is better) | −3.9% | Average beats 45% | −4.4% | – | – |
| Efficiency | |||||
| Inventory turnover | 5.4x | Good beats 77% | 3.9x | 3.8x | ▲ Better |
| Days sales outstanding | 51 days | Good beats 72% | 63 days | 57 days | ▲ Better |
These ratings compare companies with each other and describe the past; they are not a forecast, a recommendation or part of the X-Ray Score. A factor is left out when its data is missing or meaningless (for example a P/E on negative earnings). A dash in the history columns means fewer than three usable years.
Fundamentals checklist
● 1 Good · ● 7 Average · ● 8 BadCash quality
Earnings backed by cashAverage
Free-cash-flow yieldAverage
Risk models
Altman Z''Average
Piotroski F-ScoreBad
Growth
EPS growth (3y)Average
Free-cash-flow growth (3y)Bad
Revenue growth (3y)Average
Growth consistencyAverage
Balance sheet
Current ratioAverage
Net debt / EBITDABad
Interest coverBad
Valuation
Fair value vs priceGood
EBIT / EV yieldBad
Profitability
Return on invested capitalBad
Operating marginBad
Gross profitabilityBad
Each check is graded against the company's sector, not a fixed number. Checklist score 31/100.
Financials
| FY21 | FY22 | FY23 | FY24 | FY25 | |
|---|---|---|---|---|---|
| Revenue | $4.2B | $5.1B | $5.3B | $6.1B | $7.1B |
| Operating income | $735M | $1.1B | $1.3B | $1.4B | $915M |
| Net income | $758M | $985M | $1.2B | $2.3B | $1.3B |
| Operating cash flow | $1.5B | $1.7B | $1.7B | $1.4B | $1.5B |
| Operating margin | 17.5% | 22.6% | 23.9% | 22.1% | 13.0% |
| Free cash flow | $1.4B | $1.6B | $1.5B | $1.3B | $1.3B |
| Diluted EPS | $4.81 | $6.29 | $7.92 | $14.51 | $8.04 |
Fiscal years, from SEC filings.
Technical summary
Daily
Bearish
3 bullish · 2 neutral · 11 bearish
Weekly
Strongly bearish
1 bullish · 1 neutral · 10 bearish
Monthly
Strongly bearish
0 bullish · 1 neutral · 7 bearish
Moving averages (daily)
| SMA 10 | 468.6 | Bearish |
| EMA 10 | 457.3 | Bearish |
| SMA 20 | 467.7 | Bearish |
| EMA 20 | 456.7 | Bearish |
| SMA 50 | 430.5 | Bearish |
| EMA 50 | 441.6 | Bearish |
| SMA 100 | 430.5 | Bearish |
| EMA 100 | 438.0 | Bearish |
| SMA 200 | 445.0 | Bearish |
| EMA 200 | 445.7 | Bearish |
Oscillators (daily)
| RSI (14) | 39.16 | Neutral |
| MACD (12, 26) | 5.89 | Bullish |
| Momentum (12) | -16.37 | Bearish |
| Stochastic %K (14) | 0.41 | Bullish |
| Williams %R (14) | -99.59 | Bullish |
| CCI (20) | -92.91 | Neutral |
Pivot points (classic, last session)
S3 393.1 | S2 407.6 | S1 415.0 | Pivot 429.5 | R1 437.0 | R2 451.5 | R3 458.9 |
Signals describe what the chart is doing, not what to do. Moving averages: price above the average is bullish. Oscillators use the usual thresholds (RSI 30/70, Stochastic 20/80, CCI ±100, Williams %R −80/−20; MACD and momentum above zero are bullish). Weekly and monthly views use closing prices only.
ETFs that hold SNPS
| ETF | Share of the fund |
|---|---|
| IGV iShares Expanded Tech-Software Sector | 3.23% |
| AIPI REX AI Equity Premium Income | 2.45% |
| QTEC First Trust NASDAQ-100-Technology Sect... | 1.96% |
| CHPY YieldMax Semiconductor Portfolio Optio... | 1.88% |
| SMH VanEck Semiconductor | 1.79% |
| QLTY GMO U.S. Quality | 1.48% |
| IGPT Invesco AI and Next Gen Software | 1.33% |
| RSPT Invesco S&P 500 Equal Weight Technolog... | 1.15% |
The eight funds with the largest weight in SNPS among the ETFs we cover, from each fund's latest SEC Form N-PORT (quarter-end positions, so they can be months old). All ETFs.
SNPS stock splits
SNPS has split its stock 2 times since 1995. The latest was a 2-for-1 split on 24 Sep 2003.
Full SNPS stock split history →SNPS SEC filings
8-KSEC EDGAR
Other events
8-KSEC EDGAR
Results of operations
10-QSEC EDGAR
Quarterly report
8-KSEC EDGAR
Director or officer change
8-KSEC EDGAR
Entered a material agreement; Director or officer change
8-KSEC EDGAR
Results of operations
10-QSEC EDGAR
Quarterly report
8-KSEC EDGAR
Director or officer change; Shareholder vote results
Where the numbers come from
Statements SEC EDGAR filings (10-K, 10-Q), quarters derived from year-to-date figures.
Prices end-of-day closes, split-adjusted.
Industry inputs beta, multiples and equity risk premium from Damodaran Online (NYU Stern).
StocksXray is for education only and is not financial advice. Scores and fair values are model estimates from public filings and carry uncertainty.