Synaptics (NASDAQ:SYNA) Shares Gap Up on Analyst Upgrade

Key Points

• Synaptics shares surged after Rosenblatt Securities raised its price target from $115 to $123, with the stock opening at $121.70 versus a prior close of $106.15.
• Analyst sentiment remains broadly cautious: Synaptics has a consensus “Hold” rating and an average price target of $123.09.
• The company’s all-cash, $123-per-share acquisition by ON Semiconductor is supporting the stock, though investors still face shareholder, regulatory and deal-completion risks. Insiders have sold 15,951 shares worth about $1.6 million over the past 90 days.

Synaptics Incorporated (NASDAQ:SYNA - Get Free Report)'s share price gapped up before the market opened on Friday after Rosenblatt Securities raised their price target on the stock from $115.00 to $123.00. The stock had previously closed at $106.15, but opened at $121.70. Rosenblatt Securities currently has a neutral rating on the stock. Synaptics shares last traded at $121.1280, with a volume of 2,441,505 shares.

Several other equities research analysts have also commented on SYNA. Weiss Ratings lowered Synaptics from a "sell (d)" rating to a "sell (d-)" rating in a research note on Tuesday, August 11th. Craig Hallum set a $105.00 price objective on Synaptics in a report on Friday, August 7th. Northland Securities downgraded Synaptics from a "strong-buy" rating to a "hold" rating in a research report on Friday, June 26th. Barclays reissued an "equal weight" rating and issued a $135.00 target price (up from $110.00) on shares of Synaptics in a report on Friday, June 26th. Finally, Susquehanna dropped their price target on Synaptics from $140.00 to $125.00 and set a "neutral" rating for the company in a research report on Tuesday, July 21st. One research analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, nine have issued a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $123.09.

Insider Activity at Synaptics

In other news, insider Lisa Bodensteiner sold 334 shares of the business's stock in a transaction on Friday, September 18th. The stock was sold at an average price of $92.63, for a total value of $30,938.42. Following the completion of the transaction, the insider directly owned 77,518 shares of the company's stock, valued at $7,180,492.34. The trade was a 0.43% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Vikram Gupta sold 4,277 shares of the stock in a transaction dated Tuesday, August 25th. The stock was sold at an average price of $94.49, for a total transaction of $404,133.73. Following the transaction, the insider owned 99,191 shares in the company, valued at approximately $9,372,557.59. The trade was a 4.13% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders have sold 15,951 shares of company stock valued at $1,612,862. 0.70% of the stock is owned by corporate insiders.

Trending Headlines about Synaptics

Here are the key news stories impacting Synaptics this week:

• Positive Sentiment: The all-cash offer provides Synaptics investors with greater deal certainty and eliminates the stock-market risk associated with receiving ON Semiconductor shares. The $123 consideration is also above Synaptics’ supplied $106.15 opening price. ON Semiconductor to Buy Synaptics for Cash, Not Stock, in Downsized Deal
• Positive Sentiment: The amended agreement helped remove uncertainty around the transaction and prompted a strong after-hours and premarket response in SYNA. Reports describe the revised deal as a renegotiated, downsized acquisition while retaining the $123-per-share cash price. On Semi Is Getting Synaptics at a Knock Down Price and Both Stocks Are Soaring
• Positive Sentiment: The transaction is also viewed favorably for ON Semiconductor, with Needham maintaining a Buy rating and stating that the all-cash Synaptics deal could increase ON’s earnings per share by about 11.6%. That supports the strategic rationale for completing the acquisition. ON Semiconductor Buy Rating Reaffirmed as All-Cash Synaptics Deal Boosts EPS
• Neutral Sentiment: Because the stock is trading near the $123 offer value, further upside may depend primarily on deal completion rather than Synaptics’ standalone operating performance. Investors should monitor shareholder, regulatory and closing risks. Why Are ON Semiconductor and Synaptics Stocks Surging in Premarket?

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of SYNA. William Blair Investment Management LLC acquired a new stake in shares of Synaptics in the second quarter valued at about $153,998,000. The Manufacturers Life Insurance Company purchased a new position in Synaptics in the 2nd quarter worth approximately $133,656,000. Geode Capital Management LLC boosted its holdings in Synaptics by 1.7% in the 4th quarter. Geode Capital Management LLC now owns 1,000,456 shares of the software maker's stock worth $74,066,000 after acquiring an additional 17,088 shares during the period. Trigran Investments Inc. grew its position in Synaptics by 4.7% in the fourth quarter. Trigran Investments Inc. now owns 692,587 shares of the software maker's stock valued at $51,265,000 after acquiring an additional 31,150 shares in the last quarter. Finally, Primecap Management Co. CA acquired a new stake in Synaptics in the second quarter valued at approximately $56,649,000. Institutional investors and hedge funds own 99.43% of the company's stock.

Synaptics Price Performance

The company has a market cap of $4.80 billion, a PE ratio of -9.55 and a beta of 1.96. The business's 50 day moving average price is $100.78 and its 200-day moving average price is $106.47. The company has a quick ratio of 0.90, a current ratio of 1.12 and a debt-to-equity ratio of 0.43.

Synaptics (NASDAQ:SYNA - Get Free Report) last announced its earnings results on Thursday, August 6th. The software maker reported $1.23 earnings per share for the quarter, beating the consensus estimate of $1.21 by $0.02. The business had revenue of $308.00 million during the quarter, compared to the consensus estimate of $305.32 million. Synaptics had a negative net margin of 41.00% and a positive return on equity of 4.37%. The business's quarterly revenue was up 8.9% compared to the same quarter last year. During the same period in the prior year, the firm earned $1.01 earnings per share. As a group, analysts forecast that Synaptics Incorporated will post 1.98 earnings per share for the current year.

About Synaptics

Synaptics Incorporated NASDAQ: SYNA is a fabless semiconductor company that develops technologies enabling people to interact with digital devices. Its products combine sensing, processing, connectivity and artificial intelligence capabilities for consumer electronics, automotive systems and Internet of Things applications.

The company's portfolio includes touch and display controllers, touchpads, fingerprint sensors, audio and voice-processing solutions, wireless connectivity products, and video and vision processors.

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