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Synopsys (SNPS) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, Synopsys (SNPS - Free Report) closed at $140.07, marking a +1.36% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.22%. At the same time, the Dow added 0.2%, and the tech-heavy Nasdaq gained 0.18%.

Coming into today, shares of the maker of software used to test and develop chips had gained 0.66% in the past month. In that same time, the Computer and Technology sector gained 4.77%, while the S&P 500 gained 3.89%.

Wall Street will be looking for positivity from SNPS as it approaches its next earnings report date. This is expected to be December 4, 2019. In that report, analysts expect SNPS to post earnings of $1.13 per share. This would mark year-over-year growth of 44.87%. Our most recent consensus estimate is calling for quarterly revenue of $851.06 million, up 7.04% from the year-ago period.

Any recent changes to analyst estimates for SNPS should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SNPS is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note SNPS's current valuation metrics, including its Forward P/E ratio of 27.68. This represents a discount compared to its industry's average Forward P/E of 31.8.

Investors should also note that SNPS has a PEG ratio of 2.31 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 2.34 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 90, putting it in the top 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.


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