Synopsys (SNPS - Free Report) closed at $135.63 in the latest trading session, marking a -0.1% move from the prior day. This move was narrower than the S&P 500's daily loss of 0.12%. At the same time, the Dow added 0.11%, and the tech-heavy Nasdaq gained 0.02%.
Prior to today's trading, shares of the maker of software used to test and develop chips had lost 1.54% over the past month. This has lagged the Computer and Technology sector's gain of 5.66% and the S&P 500's gain of 4.42% in that time.
SNPS will be looking to display strength as it nears its next earnings release. In that report, analysts expect SNPS to post earnings of $1.13 per share. This would mark year-over-year growth of 44.87%. Meanwhile, our latest consensus estimate is calling for revenue of $849.55 million, up 6.85% from the prior-year quarter.
Investors might also notice recent changes to analyst estimates for SNPS. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. SNPS currently has a Zacks Rank of #3 (Hold).
Investors should also note SNPS's current valuation metrics, including its Forward P/E ratio of 27.2. Its industry sports an average Forward P/E of 30.42, so we one might conclude that SNPS is trading at a discount comparatively.
Investors should also note that SNPS has a PEG ratio of 2.27 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Computer - Software industry currently had an average PEG ratio of 2.26 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 45, putting it in the top 18% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the 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.