Zacks Investment Research Downgrades Synopsys (SNPS) to Hold

Synopsys (NASDAQ:SNPS) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a note issued to investors on Wednesday, Zacks.com reports. They presently have a $124.00 price target on the semiconductor company’s stock. Zacks Investment Research‘s price target indicates a potential upside of 5.95% from the stock’s previous close.

According to Zacks, “Synopsys reported solid second-quarter fiscal 2019 results. The company is gaining traction from solid growth across both its operating segments. Growing demand for advanced technology, design, IP and security solutions is creating a solid market opportunity for Synopsys. Its penetration into new and growing AI chip companies is a major growth driver. Rising impact of AI, 5G, IoT and big data is boosting investments in new compute and machine-learning architectures, which is a tailwind. However, geo-political challenges coupled with uncertainties hovering around government actions to restrict trade with Huawei are a concern. As a result of the trade ban, management mentioned that the company is unable to book new business and recognition of currently contracted revenues is on hold. This makes us cautious about its near-term prospects.”

Several other analysts also recently weighed in on the company. BidaskClub downgraded Synopsys from a “strong-buy” rating to a “buy” rating in a research report on Wednesday, May 22nd. Wells Fargo & Co assumed coverage on Synopsys in a report on Tuesday, May 14th. They issued an “outperform” rating and a $135.00 price objective for the company. Royal Bank of Canada lifted their price objective on Synopsys from $130.00 to $140.00 and gave the company a “top pick” rating in a report on Thursday, April 11th. KeyCorp assumed coverage on Synopsys in a report on Wednesday, April 10th. They issued an “overweight” rating and a $135.00 price objective for the company. Finally, DA Davidson lifted their price objective on Synopsys to $135.00 and gave the company a “buy” rating in a report on Wednesday, April 3rd. Two research analysts have rated the stock with a hold rating, seven have given a buy rating and one has assigned a strong buy rating to the stock. The company has a consensus rating of “Buy” and an average target price of $124.00.

NASDAQ:SNPS opened at $117.04 on Wednesday. Synopsys has a twelve month low of $79.14 and a twelve month high of $124.12. The firm has a market cap of $17.42 billion, a PE ratio of 41.50, a price-to-earnings-growth ratio of 3.54 and a beta of 1.30. The company has a quick ratio of 0.85, a current ratio of 0.95 and a debt-to-equity ratio of 0.03.

Synopsys (NASDAQ:SNPS) last released its earnings results on Wednesday, May 22nd. The semiconductor company reported $0.77 earnings per share for the quarter, topping the consensus estimate of $0.73 by $0.04. Synopsys had a return on equity of 16.88% and a net margin of 18.74%. The business had revenue of $836.20 million during the quarter, compared to the consensus estimate of $829.41 million. During the same period last year, the company earned $1.08 earnings per share. The business’s revenue for the quarter was up 7.6% compared to the same quarter last year. On average, sell-side analysts anticipate that Synopsys will post 3.03 earnings per share for the current year.

In related news, Director Chrysostomos L. Nikias sold 1,050 shares of Synopsys stock in a transaction dated Friday, May 24th. The stock was sold at an average price of $117.36, for a total value of $123,228.00. Following the completion of the sale, the director now directly owns 22,881 shares in the company, valued at $2,685,314.16. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, Chairman Geus Aart De sold 156,100 shares of Synopsys stock in a transaction dated Friday, May 24th. The shares were sold at an average price of $117.15, for a total value of $18,287,115.00. Following the completion of the sale, the chairman now owns 189,894 shares of the company’s stock, valued at $22,246,082.10. The disclosure for this sale can be found here. Insiders sold 187,255 shares of company stock valued at $21,905,644 over the last 90 days. 1.84% of the stock is currently owned by corporate insiders.

Hedge funds have recently added to or reduced their stakes in the stock. Flagship Harbor Advisors LLC grew its stake in Synopsys by 78.7% in the first quarter. Flagship Harbor Advisors LLC now owns 227 shares of the semiconductor company’s stock valued at $26,000 after purchasing an additional 100 shares during the last quarter. Tompkins Financial Corp grew its stake in Synopsys by 63.7% in the first quarter. Tompkins Financial Corp now owns 280 shares of the semiconductor company’s stock valued at $28,000 after purchasing an additional 109 shares during the last quarter. Trust Co. of Vermont purchased a new position in Synopsys in the fourth quarter valued at about $29,000. Executive Wealth Management LLC purchased a new position in Synopsys in the fourth quarter valued at about $29,000. Finally, Hanseatic Management Services Inc. purchased a new position in Synopsys in the first quarter valued at about $30,000. Hedge funds and other institutional investors own 92.03% of the company’s stock.

Synopsys Company Profile

Synopsys, Inc provides electronic design automation software products used to design and test integrated circuits (ICs). It offers Fusion Design Platform, a digital design implementation solution; Verification Continuum Platform, which provides 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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