Synopsys (NASDAQ:SNPS) Issues FY 2025 Earnings Guidance

Key Points

• Synopsys has revised its FY 2025 earnings guidance, projecting an EPS of 12.760-12.800, lower than the consensus estimate of 13.100, and revenue guidance of $7.0 billion-$7.1 billion, compared to the consensus of $7.2 billion.
• Several analysts have upgraded their ratings on Synopsys, with Morgan Stanley raising its target price from $540.00 to $715.00, indicating strong investor confidence in the company's performance.
• The stock traded down to $604.37 during midday trading, with a one-year high of $651.73, highlighting recent market volatility despite the company's robust fundamentals.

Synopsys (NASDAQ:SNPS - Get Free Report) updated its FY 2025 earnings guidance on Tuesday. The company provided earnings per share (EPS) guidance of 12.760-12.800 for the period, compared to the consensus estimate of 13.100. The company issued revenue guidance of $7.0 billion-$7.1 billion, compared to the consensus revenue estimate of $7.2 billion. Synopsys also updated its Q4 2025 guidance to 2.760-2.80 EPS.

Analyst Ratings Changes

Several analysts have issued reports on SNPS shares. Morgan Stanley restated an "overweight" rating and issued a $715.00 target price (up from $540.00) on shares of Synopsys in a research note on Monday, August 11th. Rosenblatt Securities upped their price objective on Synopsys from $625.00 to $650.00 and gave the stock a "buy" rating in a report on Friday, July 25th. Piper Sandler boosted their target price on Synopsys from $615.00 to $660.00 and gave the company an "overweight" rating in a research note on Monday, July 21st. KeyCorp upped their price target on Synopsys from $610.00 to $660.00 and gave the company an "overweight" rating in a research report on Wednesday, September 3rd. Finally, Wells Fargo & Company restated a "positive" rating on shares of Synopsys in a research note on Wednesday, August 27th. Twelve analysts have rated the stock with a Buy rating and one has issued a Hold rating to the company's stock. Based on data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus target price of $638.21.

Synopsys Stock Performance

Shares of NASDAQ SNPS traded down $4.71 during midday trading on Tuesday, hitting $604.37. 2,095,111 shares of the stock traded hands, compared to its average volume of 1,408,363. Synopsys has a one year low of $365.74 and a one year high of $651.73. The firm has a 50-day moving average of $596.04 and a two-hundred day moving average of $507.14. The firm has a market capitalization of $93.77 billion, a P/E ratio of 43.64, a PEG ratio of 3.93 and a beta of 1.14. The company has a debt-to-equity ratio of 1.01, a quick ratio of 6.85 and a current ratio of 7.02.

Insider Buying and Selling

In related news, CFO Shelagh Glaser sold 3,655 shares of the firm's stock in a transaction on Friday, September 5th. The stock was sold at an average price of $609.77, for a total value of $2,228,709.35. Following the transaction, the chief financial officer directly owned 15,317 shares of the company's stock, valued at approximately $9,339,847.09. This trade represents a 19.27% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, CEO Sassine Ghazi sold 11,366 shares of the firm's stock in a transaction dated Tuesday, September 2nd. The shares were sold at an average price of $589.01, for a total value of $6,694,687.66. Following the sale, the chief executive officer directly owned 71,615 shares in the company, valued at approximately $42,181,951.15. This represents a 13.70% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last three months, insiders have sold 24,031 shares of company stock valued at $13,168,999. 0.62% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently made changes to their positions in SNPS. TOMS Capital Investment Management LP purchased a new position in shares of Synopsys during the second quarter valued at about $110,739,000. Bank of America Corp DE boosted its position in shares of Synopsys by 31.6% during the second quarter. Bank of America Corp DE now owns 898,612 shares of the semiconductor company's stock valued at $460,701,000 after buying an additional 215,721 shares during the period. Canada Pension Plan Investment Board boosted its position in shares of Synopsys by 175.1% during the second quarter. Canada Pension Plan Investment Board now owns 145,922 shares of the semiconductor company's stock valued at $74,811,000 after buying an additional 92,883 shares during the period. Adage Capital Partners GP L.L.C. boosted its position in shares of Synopsys by 104.8% during the second quarter. Adage Capital Partners GP L.L.C. now owns 106,551 shares of the semiconductor company's stock valued at $54,627,000 after buying an additional 54,520 shares during the period. Finally, Raymond James Financial Inc. raised its stake in shares of Synopsys by 9.1% during the second quarter. Raymond James Financial Inc. now owns 421,649 shares of the semiconductor company's stock valued at $216,171,000 after acquiring an additional 35,261 shares in the last quarter. Hedge funds and other institutional investors own 85.47% of the company's stock.

About Synopsys

Synopsys, Inc provides electronic design automation software products used to design and test integrated circuits. It operates in three segments: Design Automation, Design IP, and Software Integrity. The company offers Digital and Custom IC Design solution that provides digital design implementation solutions; Verification solution that offers virtual prototyping, static and formal verification, simulation, emulation, field programmable gate array (FPGA)-based prototyping, and debug solutions; and FPGA design products that are programmed to perform specific functions.

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