Synopsys (SNPS) closed the most recent trading day at $156.92, moving +1.71% from the previous trading session. This change outpaced the S&P 500's 0.73% gain on the day. Elsewhere, the Dow gained 0.6%, while the tech-heavy Nasdaq added 1.13%.
Prior to today's trading, shares of the maker of software used to test and develop chips had gained 3.77% over the past month. This has lagged the Computer and Technology sector's gain of 5.28% and outpaced the S&P 500's gain of 2.95% in that time.
Wall Street will be looking for positivity from SNPS as it approaches its next earnings report date. This is expected to be February 19, 2020. 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%. Meanwhile, our latest consensus estimate is calling for revenue of $822.30 million, up 0.23% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.22 per share and revenue of $3.62 billion. These totals would mark changes of +14.47% and +7.85%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for SNPS. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. 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 29.54. For comparison, its industry has an average Forward P/E of 33.6, which means SNPS is trading at a discount to the group.
Also, we should mention that SNPS has a PEG ratio of 2.32. 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 2.31 as of yesterday's close.
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 28% 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.