Synopsys (SNPS - Free Report) closed at $150.26 in the latest trading session, marking a +1.86% move from the prior day. This move outpaced the S&P 500's daily gain of 0.73%. Meanwhile, the Dow gained 0.51%, and the Nasdaq, a tech-heavy index, added 1.34%.
Heading into today, shares of the maker of software used to test and develop chips had gained 3.25% over the past month, outpacing the Computer and Technology sector's gain of 2.97% and the S&P 500's of 0% 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 $0.92 per share. This would mark a year-over-year decline of 14.81%. Our most recent consensus estimate is calling for quarterly revenue of $822.30 million, up 0.23% from the year-ago period.
SNPS's full-year Zacks Consensus Estimates are calling for earnings of $5.22 per share and revenue of $3.62 billion. These results would represent year-over-year changes of +14.47% and +7.85%, respectively.
Any recent changes to analyst estimates for SNPS should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
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 currently a Zacks Rank #1 (Strong Buy).
Investors should also note SNPS's current valuation metrics, including its Forward P/E ratio of 28.25. Its industry sports an average Forward P/E of 31.18, so we one might conclude that SNPS is trading at a discount comparatively.
Meanwhile, SNPS's PEG ratio is currently 2.21. 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. SNPS's industry had an average PEG ratio of 2.22 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 42, putting it in the top 17% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.