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Synopsys (SNPS) Buys Semiconductor Analytics Firm Qualtera

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In sync with its strategy of growing through acquisitions, Synopsys (SNPS - Free Report) recently announced that it has bought a semiconductor analytics firm Qualtera. The financial terms of the deal have been kept under wraps. Synopsys also stated that the purchase isn’t material to its financials.

Qualtera is one of the leading providers of big data-analytics systems and services for test and product engineering to semiconductor companies. The company’s next generation of high-volume industrial big data solutions provides semiconductor companies a real-time intelligence and control for IC manufacturing and test operations.

Synopsys intends to integrate Qualtera's advanced analytics technology with its Synopsys Yield Explorer and Synopsys TestMAX products. Synopsys’ Yield Explorer focuses on providing design-centric yield management solutions, while the TestMAX improves the process of using silicon measurements, in turn helping semiconductor companies make improvements throughout a device's development and manufacturing lifecycle.

The combination will help Synopsys’ customers maximize efficiencies by fully optimizing the pre-silicon and post-silicon phases of the silicon lifecycle. Per the company, integration of Qualtera’s high-performance analytics with Yield Explorer will enable faster results and help analyze larger volumes of data with more accuracy.

Similarly, combination of Qualtera’s analytics and production-control capabilities with Synopsys’ TestMAX will enable more efficient tests and accurate failure screening. This will help semiconductor companies reduce test costs while ensuring the highest possible product quality.

Acquisitions are central to the company’s growth strategy and provide access to newer markets and technologies. Also, since intense competition is making the EDA market tougher to penetrate, acquisitions have helped the company boost revenues.

Synopsys has made three important acquisitions — Terrain Technologies, INVECAS IP, and Tinfoil Security — in the year so far. Throughout its 30+ year history of doing business, the company has acquired more 90 companies of all sizes, big or small.

The company’s solid balance sheet and cash-flow generation capabilities have helped Synopsys acquire assets. As of Apr 30, 2020, Synopsys had cash and cash equivalents of $856 million. During the first half of fiscal 2020, the company had generated approximately $390 million of cash flow from operational activities.

Zacks Rank & Other Key Picks

Synopsys currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other top-ranked stocks in the broader computer technology sector include Atlassian Plc (TEAM - Free Report) , NVIDIA Corporation (NVDA - Free Report) and Micron Technology (MU - Free Report) . All three stocks carry a Zacks Rank #2 currently.

The long-term earnings growth rate for Atlassian, NVIDIA and Micron is pegged at 22.6%, 16.9% and 10.3%, respectively.

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