Synopsys (NASDAQ:SNPS) to Repurchase $1.00 billion in Stock

Synopsys (NASDAQ:SNPS) declared that its Board of Directors has approved a stock repurchase plan on Monday, October 5th, RTT News reports. The company plans to repurchase $1.00 billion in shares. This repurchase authorization permits the semiconductor company to purchase up to 1.1% of its stock through open market purchases. Stock repurchase plans are often a sign that the company’s management believes its shares are undervalued.

Synopsys Trading Down 0.5%

SNPS opened at $502.67 on Thursday. The company’s 50 day moving average is $415.01 and its 200-day moving average is $437.96. Synopsys has a 1-year low of $362.55 and a 1-year high of $539.48. The company has a current ratio of 1.34, a quick ratio of 1.24 and a debt-to-equity ratio of 0.29. The company has a market cap of $96.33 billion, a P/E ratio of 88.81, a PEG ratio of 2.06 and a beta of 1.21.

Synopsys (NASDAQ:SNPS) last released its quarterly earnings data on Wednesday, August 26th. The semiconductor company reported $3.91 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $3.67 by $0.24. The business had revenue of $2.48 billion during the quarter, compared to analysts’ expectations of $2.44 billion. Synopsys had a net margin of 11.43% and a return on equity of 6.24%. The firm’s quarterly revenue was up 42.4% compared to the same quarter last year. During the same period in the prior year, the company earned $3.39 EPS. Synopsys has set its Q4 2026 guidance at 4.100-4.160 EPS and its FY 2026 guidance at 15.040-15.100 EPS. Equities research analysts predict that Synopsys will post 10.97 earnings per share for the current fiscal year.

Wall Street Analysts Forecast Growth

A number of brokerages have recently weighed in on SNPS. Benchmark reaffirmed a “buy” rating and set a $570.00 price target on shares of Synopsys in a report on Thursday, August 27th. Sanford C. Bernstein initiated coverage on shares of Synopsys in a research note on Friday, September 25th. They issued an “outperform” rating on the stock. Deutsche Bank Aktiengesellschaft restated a “buy” rating and set a $640.00 price objective on shares of Synopsys in a research report on Thursday, October 1st. KeyCorp upped their target price on Synopsys from $600.00 to $605.00 and gave the stock an “overweight” rating in a research note on Thursday, October 1st. Finally, Barclays began coverage on Synopsys in a report on Friday, September 25th. They issued an “overweight” rating on the stock. One equities research analyst has rated the stock with a Strong Buy rating, seventeen have given a Buy rating, three have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, the company currently has a consensus rating of “Moderate Buy” and a consensus price target of $584.11.

Insider Activity at Synopsys

In related news, CFO Sudhindra Kankanwadi sold 9,170 shares of the firm’s stock in a transaction on Tuesday, October 6th. The stock was sold at an average price of $500.00, for a total transaction of $4,585,000.00. Following the sale, the chief financial officer owned 22,717 shares of the company’s stock, valued at $11,358,500. This trade represents a 28.76% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, insider Janet Lee sold 1,144 shares of the business’s stock in a transaction on Tuesday, October 6th. The stock was sold at an average price of $502.52, for a total value of $574,882.88. Following the sale, the insider owned 16,534 shares in the company, valued at $8,308,665.68. This represents a 6.47% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 102,559 shares of company stock valued at $44,607,141 over the last three months. 0.56% of the stock is currently owned by corporate insiders.

Key Stories Impacting Synopsys

Here are the key news stories impacting Synopsys this week:

• Positive Sentiment: New AI chip-design alliances with OpenAI and Amazon strengthen Synopsys’ position in electronic-design-automation software for AI infrastructure. The expanded Amazon relationship could represent a significant long-term growth opportunity, potentially worth up to $1 billion. Synopsys Is Up 17.7% After New AI Chip-Design Alliances With OpenAI And Amazon
• Positive Sentiment: The board authorized a $1 billion share-repurchase program, allowing the company to buy back as much as 1.1% of outstanding shares. Repurchases could support earnings per share and signal management believes the stock is undervalued. Stock Repurchase Program Declared by Synopsys Board
• Positive Sentiment: Synopsys recently exceeded quarterly expectations, reporting $3.91 in adjusted EPS versus a $3.67 estimate and $2.48 billion in revenue versus $2.44 billion expected. Revenue rose 42.4% year over year, supporting the broader AI and semiconductor-design growth story.
• Neutral Sentiment: Analyst sentiment remains favorable overall, with a consensus rating of Moderate Buy and an average price target of $584.11. However, ratings range from HSBC’s “reduce” recommendation to Deutsche Bank’s $640 target, highlighting disagreement over valuation and near-term upside.
• Neutral Sentiment: Synopsys may be undervalued relative to its long-term role as a key design-software supplier for AI chips, but commentary also points to slowing EDA growth, acquisition-related debt of roughly $10 billion and a premium earnings multiple near 89 times.
• Negative Sentiment: Insider selling could weigh on sentiment. CFO Sudhindra Kankanwadi sold a combined 12,170 shares for approximately $6.04 million, reducing his holdings by roughly 40%; Janet Lee separately sold 1,144 shares worth about $575,000. These transactions do not necessarily indicate a change in business outlook, but they provide a near-term overhang. Synopsys Insider Selling
• Negative Sentiment: Despite repeated earnings beats, SNPS has reportedly declined after each recent earnings release, suggesting that high investor expectations may be limiting the stock’s reaction to strong results. Synopsys Is Hot Again But a Pattern Has Emerged

About Synopsys

Synopsys, Inc is a technology company that develops electronic design automation (EDA) software, semiconductor intellectual property (IP), and software tools used to design, verify, and manufacture advanced electronic systems. Its solutions support the development of semiconductors, systems-on-chip, and electronic products across the design cycle, from initial specification and architecture through testing and production.

The company’s offerings include digital and custom integrated-circuit design tools, simulation and verification software, physical design and signoff products, and semiconductor IP such as processor cores, interface technologies, and foundational components.