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Synopsys (SNPS) to Report Q1 Earnings: What's in Store?
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Synopsys (SNPS - Free Report) is slated to release first-quarter fiscal 2021 results on Feb 17.
Management expects first-quarter revenues between $935 million and $965 million. The Zacks Consensus Estimate for the top line is currently pegged at $952.24 million, indicating 14.13% year-on-year growth.
Management expects non-GAAP earnings between $1.44 and $1.49 per share. Notably, the consensus mark for earnings is pegged at $1.45 per share, indicating 43.56% year-over-year growth.
Let’s see how things have shaped up prior to this announcement.
Synopsys’ fiscal first-quarter performance is likely to have benefited from growing demand for its solid product portfolio. Increasing global design activity and customer engagements are likely to have been growth drivers.
Moreover, the rising impact of AI; 5G; IoT; high-performance computing and the Cloud; and automotive is anticipated to have boosted demand for the company’s advanced solutions. Synopsys’ performance is likely to have gained from growth in Custom Compiler, which is fueled by large deal wins in the 5G, AI and server chip markets.
Additionally, widespread contract wins and the increasing deployment of the Fusion Platform, including Fusion Compiler, are anticipated to have been key growth drivers. Moreover, Synopsys’ Verification Continuum platform witnesses robust demand and competitive gains, which are anticipated to have been major catalysts as well.
Notably, the ongoing shift to high-performance cloud computing owing to the coronavirus-induced remote working environment is expected to have aided demand for the company’s Intellectual Property (IP) solutions, such as PCI Express, 112G Ethernet and DDR.
Further, the company’s USB4 IP solution for advanced 5nm processes is likely to have driven order growth in the to-be-reported quarter. Also, strong adoption of its interface and foundation IP solutions is expected to have boosted revenues for the company’s interface portfolio.
Furthermore, the company’s solid electronic design automation (EDA) software partner base, which includes Advanced Micro Devices, Juniper Networks, Realtek, Toshiba and Wolfson, is likely to have served as a major revenue driver.
Additionally, increased design investments in Synopsys’s ARC processors by automotive companies despite the coronavirus-led headwinds in the automotive space are expected to have been a positive.
However, partial resumption of normal activities is expected to have brought back certain expenditures, which were on hold during the lockdown and work-from-home period. This might have been a slight drag on margins.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Synopsys this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Synopsys currently has a Zacks Rank of 4 (Sell) and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Agilent Technologies, Inc. (A - Free Report) has an Earnings ESP of +4.64% and a Zacks Rank of 3, currently.
Adobe Inc. (ADBE - Free Report) has an Earnings ESP of +0.36% and currently, a Zacks Rank of 3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Synopsys (SNPS) to Report Q1 Earnings: What's in Store?
Synopsys (SNPS - Free Report) is slated to release first-quarter fiscal 2021 results on Feb 17.
Management expects first-quarter revenues between $935 million and $965 million. The Zacks Consensus Estimate for the top line is currently pegged at $952.24 million, indicating 14.13% year-on-year growth.
Management expects non-GAAP earnings between $1.44 and $1.49 per share. Notably, the consensus mark for earnings is pegged at $1.45 per share, indicating 43.56% year-over-year growth.
Let’s see how things have shaped up prior to this announcement.
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Factors to Consider
Synopsys’ fiscal first-quarter performance is likely to have benefited from growing demand for its solid product portfolio. Increasing global design activity and customer engagements are likely to have been growth drivers.
Moreover, the rising impact of AI; 5G; IoT; high-performance computing and the Cloud; and automotive is anticipated to have boosted demand for the company’s advanced solutions. Synopsys’ performance is likely to have gained from growth in Custom Compiler, which is fueled by large deal wins in the 5G, AI and server chip markets.
Additionally, widespread contract wins and the increasing deployment of the Fusion Platform, including Fusion Compiler, are anticipated to have been key growth drivers. Moreover, Synopsys’ Verification Continuum platform witnesses robust demand and competitive gains, which are anticipated to have been major catalysts as well.
Notably, the ongoing shift to high-performance cloud computing owing to the coronavirus-induced remote working environment is expected to have aided demand for the company’s Intellectual Property (IP) solutions, such as PCI Express, 112G Ethernet and DDR.
Further, the company’s USB4 IP solution for advanced 5nm processes is likely to have driven order growth in the to-be-reported quarter. Also, strong adoption of its interface and foundation IP solutions is expected to have boosted revenues for the company’s interface portfolio.
Furthermore, the company’s solid electronic design automation (EDA) software partner base, which includes Advanced Micro Devices, Juniper Networks, Realtek, Toshiba and Wolfson, is likely to have served as a major revenue driver.
Additionally, increased design investments in Synopsys’s ARC processors by automotive companies despite the coronavirus-led headwinds in the automotive space are expected to have been a positive.
However, partial resumption of normal activities is expected to have brought back certain expenditures, which were on hold during the lockdown and work-from-home period. This might have been a slight drag on margins.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Synopsys this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Synopsys currently has a Zacks Rank of 4 (Sell) and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Advance Auto Parts, Inc. (AAP - Free Report) has an Earnings ESP of +6.53% and a Zacks Rank of 3, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Agilent Technologies, Inc. (A - Free Report) has an Earnings ESP of +4.64% and a Zacks Rank of 3, currently.
Adobe Inc. (ADBE - Free Report) has an Earnings ESP of +0.36% and currently, a Zacks Rank of 3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot stocks we're targeting >>