SYNOPSYS INC (SNPS) Stock Fundamental Analysis
NASDAQ:SNPS - Nasdaq - US8716071076 - Common Stock - Currency: USD
Overall SNPS gets a fundamental rating of 6 out of 10. We evaluated SNPS against 282 industry peers in the Software industry. SNPS scores excellent on profitability, but there are some minor concerns on its financial health. SNPS is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
SNPS had positive earnings in the past year.
In the past year SNPS had a positive cash flow from operations.
Each year in the past 5 years SNPS has been profitable.
In the past 5 years SNPS always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 9.11%, SNPS belongs to the best of the industry, outperforming 85.46% of the companies in the same industry.
SNPS's Return On Equity of 21.82% is amongst the best of the industry. SNPS outperforms 87.59% of its industry peers.
SNPS has a Return On Invested Capital of 4.81%. This is in the better half of the industry: SNPS outperforms 74.82% of its industry peers.
SNPS had an Average Return On Invested Capital over the past 3 years of 12.78%. This is in line with the industry average of 12.26%.
The 3 year average ROIC (12.78%) for SNPS is well above the current ROIC(4.81%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.11% | ||
| ROE | 21.82% | ||
| ROIC | 4.81% |
ROA(3y)13.22%
ROA(5y)11.32%
ROE(3y)21.01%
ROE(5y)18.18%
ROIC(3y)12.78%
ROIC(5y)11.28%
1.3 Margins
SNPS has a better Profit Margin (34.77%) than 95.74% of its industry peers.
SNPS's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 20.88%, SNPS belongs to the top of the industry, outperforming 88.65% of the companies in the same industry.
SNPS's Operating Margin has improved in the last couple of years.
SNPS has a Gross Margin of 79.84%. This is in the better half of the industry: SNPS outperforms 79.79% of its industry peers.
In the last couple of years the Gross Margin of SNPS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.88% | ||
| PM (TTM) | 34.77% | ||
| GM | 79.84% |
OM growth 3Y6.59%
OM growth 5Y6.25%
PM growth 3Y27.03%
PM growth 5Y18.45%
GM growth 3Y0.07%
GM growth 5Y0.53%
2. Health
2.1 Basic Checks
SNPS has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, SNPS has more shares outstanding
The number of shares outstanding for SNPS has been increased compared to 5 years ago.
SNPS has a better debt/assets ratio than last year.
2.2 Solvency
SNPS has an Altman-Z score of 5.11. This indicates that SNPS is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 5.11, SNPS is doing good in the industry, outperforming 70.21% of the companies in the same industry.
SNPS has a debt to FCF ratio of 9.41. This is a negative value and a sign of low solvency as SNPS would need 9.41 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 9.41, SNPS is in line with its industry, outperforming 50.71% of the companies in the same industry.
A Debt/Equity ratio of 1.01 is on the high side and indicates that SNPS has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.01, SNPS is doing worse than 72.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 9.41 | ||
| Altman-Z | 5.11 |
ROIC/WACC0.54
WACC8.93%
2.3 Liquidity
A Current Ratio of 7.02 indicates that SNPS has no problem at all paying its short term obligations.
SNPS has a better Current ratio (7.02) than 91.84% of its industry peers.
A Quick Ratio of 6.85 indicates that SNPS has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 6.85, SNPS belongs to the top of the industry, outperforming 91.13% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 7.02 | ||
| Quick Ratio | 6.85 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.30% over the past year.
Measured over the past years, SNPS shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.99% on average per year.
SNPS shows a small growth in Revenue. In the last year, the Revenue has grown by 7.50%.
Measured over the past years, SNPS shows a quite strong growth in Revenue. The Revenue has been growing by 12.76% on average per year.
EPS 1Y (TTM)7.3%
EPS 3Y25.03%
EPS 5Y23.99%
EPS Q2Q%22.33%
Revenue 1Y (TTM)7.5%
Revenue growth 3Y13.38%
Revenue growth 5Y12.76%
Sales Q2Q%10.28%
3.2 Future
SNPS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.72% yearly.
Based on estimates for the next years, SNPS will show a quite strong growth in Revenue. The Revenue will grow by 11.34% on average per year.
EPS Next Y14.34%
EPS Next 2Y12.84%
EPS Next 3Y14.06%
EPS Next 5Y12.72%
Revenue Next Year10.07%
Revenue Next 2Y11.15%
Revenue Next 3Y11.65%
Revenue Next 5Y11.34%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 37.89 indicates a quite expensive valuation of SNPS.
Based on the Price/Earnings ratio, SNPS is valued a bit cheaper than the industry average as 65.25% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.15. SNPS is valued slightly more expensive when compared to this.
A Price/Forward Earnings ratio of 30.07 indicates a quite expensive valuation of SNPS.
Based on the Price/Forward Earnings ratio, SNPS is valued a bit cheaper than 64.54% of the companies in the same industry.
SNPS's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 21.60.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.89 | ||
| Fwd PE | 30.07 |
4.2 Price Multiples
66.31% of the companies in the same industry are more expensive than SNPS, based on the Enterprise Value to EBITDA ratio.
SNPS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 74.22 | ||
| EV/EBITDA | 46.81 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SNPS does not grow enough to justify the current Price/Earnings ratio.
SNPS has an outstanding profitability rating, which may justify a higher PE ratio.
SNPS's earnings are expected to grow with 14.06% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.64
PEG (5Y)1.58
EPS Next 2Y12.84%
EPS Next 3Y14.06%
5. Dividend
5.1 Amount
No dividends for SNPS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
512.68
+10.05 (+2%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners93.45%
Inst Owner Change4.28%
Ins Owners0.4%
Ins Owner Change-0.06%
Market Cap79.27B
Analysts82.96
Price Target597.41 (16.53%)
Short Float %3.05%
Short Ratio3.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.39%
Min EPS beat(2)4.52%
Max EPS beat(2)6.25%
EPS beat(4)4
Avg EPS beat(4)3.59%
Min EPS beat(4)0.99%
Max EPS beat(4)6.25%
EPS beat(8)7
Avg EPS beat(8)2.64%
EPS beat(12)11
Avg EPS beat(12)2.49%
EPS beat(16)13
Avg EPS beat(16)2.02%
Revenue beat(2)0
Avg Revenue beat(2)-2.15%
Min Revenue beat(2)-2.65%
Max Revenue beat(2)-1.64%
Revenue beat(4)0
Avg Revenue beat(4)-1.85%
Min Revenue beat(4)-2.65%
Max Revenue beat(4)-1.5%
Revenue beat(8)0
Avg Revenue beat(8)-1.96%
Revenue beat(12)0
Avg Revenue beat(12)-5.45%
Revenue beat(16)0
Avg Revenue beat(16)-4.39%
PT rev (1m)-1.62%
PT rev (3m)-6.75%
EPS NQ rev (1m)-3.04%
EPS NQ rev (3m)-2.96%
EPS NY rev (1m)0.65%
EPS NY rev (3m)0.54%
Revenue NQ rev (1m)0.33%
Revenue NQ rev (3m)0.17%
Revenue NY rev (1m)-0.25%
Revenue NY rev (3m)-0.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.89 | ||
| Fwd PE | 30.07 | ||
| P/S | 12.74 | ||
| P/FCF | 74.22 | ||
| P/OCF | 64.65 | ||
| P/B | 7.99 | ||
| P/tB | 12.62 | ||
| EV/EBITDA | 46.81 |
EPS(TTM)13.53
EY2.64%
EPS(NY)17.05
Fwd EY3.33%
FCF(TTM)6.91
FCFY1.35%
OCF(TTM)7.93
OCFY1.55%
SpS40.24
BVpS64.13
TBVpS40.62
PEG (NY)2.64
PEG (5Y)1.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.11% | ||
| ROE | 21.82% | ||
| ROCE | 6.09% | ||
| ROIC | 4.81% | ||
| ROICexc | 14.48% | ||
| ROICexgc | 29.74% | ||
| OM | 20.88% | ||
| PM (TTM) | 34.77% | ||
| GM | 79.84% | ||
| FCFM | 17.17% |
ROA(3y)13.22%
ROA(5y)11.32%
ROE(3y)21.01%
ROE(5y)18.18%
ROIC(3y)12.78%
ROIC(5y)11.28%
ROICexc(3y)17.68%
ROICexc(5y)15.31%
ROICexgc(3y)75.65%
ROICexgc(5y)68.48%
ROCE(3y)16.17%
ROCE(5y)14.27%
ROICexcg growth 3Y-16.41%
ROICexcg growth 5Y-15.59%
ROICexc growth 3Y9.63%
ROICexc growth 5Y8.74%
OM growth 3Y6.59%
OM growth 5Y6.25%
PM growth 3Y27.03%
PM growth 5Y18.45%
GM growth 3Y0.07%
GM growth 5Y0.53%
F-Score3
Asset Turnover0.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 9.41 | ||
| Debt/EBITDA | 6.4 | ||
| Cap/Depr | 58.99% | ||
| Cap/Sales | 2.54% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 78.23% | ||
| Profit Quality | 49.37% | ||
| Current Ratio | 7.02 | ||
| Quick Ratio | 6.85 | ||
| Altman-Z | 5.11 |
F-Score3
WACC8.93%
ROIC/WACC0.54
Cap/Depr(3y)179.61%
Cap/Depr(5y)180.51%
Cap/Sales(3y)8.65%
Cap/Sales(5y)9%
Profit Quality(3y)89.35%
Profit Quality(5y)101.69%
High Growth Momentum
Growth
EPS 1Y (TTM)7.3%
EPS 3Y25.03%
EPS 5Y23.99%
EPS Q2Q%22.33%
EPS Next Y14.34%
EPS Next 2Y12.84%
EPS Next 3Y14.06%
EPS Next 5Y12.72%
Revenue 1Y (TTM)7.5%
Revenue growth 3Y13.38%
Revenue growth 5Y12.76%
Sales Q2Q%10.28%
Revenue Next Year10.07%
Revenue Next 2Y11.15%
Revenue Next 3Y11.65%
Revenue Next 5Y11.34%
EBIT growth 1Y-9.11%
EBIT growth 3Y20.85%
EBIT growth 5Y19.81%
EBIT Next Year20.94%
EBIT Next 3Y17.49%
EBIT Next 5YN/A
FCF growth 1Y-5.73%
FCF growth 3Y0.78%
FCF growth 5Y14.95%
OCF growth 1Y-25.73%
OCF growth 3Y-1.95%
OCF growth 5Y11.94%