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Synopsys (SNPS) Falls More Steeply Than Broader Market: What Investors Need to Know

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In the latest close session, Synopsys (SNPS - Free Report) was down 1.65% at $383.82. This change lagged the S&P 500's daily loss of 0.83%. Meanwhile, the Dow lost 1.07%, and the Nasdaq, a tech-heavy index, lost 1.21%.

Heading into today, shares of the maker of software used to test and develop chips had lost 13.92% over the past month, lagging the Computer and Technology sector's gain of 0.06% and the S&P 500's gain of 0.19%.

The upcoming earnings release of Synopsys will be of great interest to investors. The company's earnings report is expected on December 10, 2025. In that report, analysts expect Synopsys to post earnings of $2.79 per share. This would mark a year-over-year decline of 17.94%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.25 billion, up 37.59% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $12.83 per share and revenue of $7.05 billion, which would represent changes of -2.8% and 0%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Synopsys. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, there's been a 0.67% fall in the Zacks Consensus EPS estimate. At present, Synopsys boasts a Zacks Rank of #3 (Hold).

Looking at its valuation, Synopsys is holding a Forward P/E ratio of 27.85. This expresses a premium compared to the average Forward P/E of 22.33 of its industry.

Also, we should mention that SNPS has a PEG ratio of 2.45. 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 was holding an average PEG ratio of 1.8 at yesterday's closing price.

The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 70, which puts it in the top 29% 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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