Declining Stock and Solid Fundamentals: Is The Market Wrong About Synopsys, Inc. (NASDAQ:SNPS)?

Simply Wall St.2024-12-27

With its stock down 10% over the past month, it is easy to disregard Synopsys (NASDAQ:SNPS). However, stock prices are usually driven by a company’s financial performance over the long term, which in ...

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However, stock prices are usually driven by a company’s financial performance over the long term, which in ...</p>\n\n<a href=\"https://finance.yahoo.com/news/declining-stock-solid-fundamentals-market-110013929.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Declining Stock and Solid Fundamentals: Is The Market Wrong About Synopsys, Inc. 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(NASDAQ:SNPS)?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-27 19:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/declining-stock-solid-fundamentals-market-110013929.html><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>With its stock down 10% over the past month, it is easy to disregard Synopsys (NASDAQ:SNPS). However, stock prices are usually driven by a company’s financial performance over the long term, which in ...</p>\n\n<a href=\"https://finance.yahoo.com/news/declining-stock-solid-fundamentals-market-110013929.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU1861220033.SGD","symbol_name":"Blackrock Next Generation Technology A2 SGD-H","start_time":0,"source_url":"https://finance.yahoo.com/news/declining-stock-solid-fundamentals-market-110013929.html","article_id":"2494680242","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2494680242","pubTimestamp":1735297213,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"With its stock down 10% over the past month, it is easy to disregard Synopsys . However, stock prices are usually driven by a company’s financial performance over the long term, which in this case looks quite promising. In this article, we decided to focus on Synopsys'  ROE.Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Simply put, it is used to assess the profitability of a company in relation to its equity capital.Return on Equity = Net Profit  ÷ Shareholders' Equity. So, based on the above formula, the ROE for Synopsys is:. Synopsys doesn't pay any regular dividends currently which essentially means that it has been reinvesting all of its profits into the business. This definitely contributes to the high earnings growth number that we discussed above.","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU1861220033.SGD":"Blackrock Next Generation Technology A2 SGD-H","LU1642822529.SGD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"A\" (SGD) ACC","QLD":"纳指两倍做多ETF","PSQ":"纳指反向ETF","LU0957791311.USD":"THREADNEEDLE (LUX) GLOBAL FOCUS \"ZU\" (USD) ACC","TQQQ":"纳指三倍做多ETF","LU1815333072.USD":"THREADNEEDLE (LUX) GLOBAL FOCUS \"AUP\" (USD) INC","USJW.SI":"ALPHAB 3xLongSG261006","NVIW.SI":"NVDA 3xLongSG261006","LU1923623000.USD":"Natixis Thematics AI & Robotics Fund R/A USD","LU1815336760.USD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"AUP\" (USD) INC","LU2413666699.HKD":"BNP PARIBAS GLOBAL ENVIRONMENT \"CRH\" (HKDHDG) INC","LU2458330169.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A\" (SGD) ACC","LU2433249047.HKD":"THEMATICS META \"R/A\" (HKD) ACC","LU1821325948.USD":"NINETY ONE GSF GLOBAL MACRO ALLOCATION \"A\" (USD) ACC","LU2458330243.SGD":"FRANKLIN SHARIAH TECHNOLOGY \"A-H1\" (SGDHDG) ACC","LU1923622614.USD":"Natixis Thematics Meta R/A USD","BK4533":"AQR资本管理(全球第二大对冲基金)","NDAQ":"纳斯达克OMX交易所","LU2360107168.USD":"BGF NEXT GENERATION TECHNOLOGY \"A4\" (USD) INC","LU2125909759.SGD":"Natixis Thematics Safety H-R/A SGD","LU0082616367.USD":"摩根大通美国科技A（dist）","LU0719512351.SGD":"JPMorgan Funds - US Technology A (acc) SGD","LU1803068979.SGD":"FTIF - Franklin Technology A (acc) SGD-H1","LU2095319765.USD":"Natixis Thematics Subscription Economy R/A USD","LU2125909916.SGD":"Natixis Thematics Safety R/A SGD","SQQQ":"纳指三倍做空ETF","LU2210150020.SGD":"Natixis Thematics Subscription Economy R/A SGD","LU1951198990.SGD":"Natixis Thematics AI & Robotics Fund H-R/A SGD-H","LU1989764748.USD":"东方汇理环球颠覆性机遇A2 Acc","LU2210149790.SGD":"Natixis Thematics Subscription Economy R/A SGD-H","SG9999004303.SGD":"Nikko AM Shenton Global Opportunities SGD","LU0109392836.USD":"富兰克林科技股A","BK4588":"碎股","LU2063271972.USD":"富兰克林创新领域基金","LU0889565833.HKD":"FRANKLIN TECHNOLOGY \"A\" (HKD) ACC","QID":"纳指两倍做空ETF","LU2413666426.HKD":"BNP PARIBAS GLOBAL ENVIRONMENT \"C\" (HKD) ACC","TSYW.SI":"TESLA 3xLongSG261006","USAW.SI":"AMZN 3xLongSG261006","IE00B64PRP62.GBP":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (GBP) ACC","SNPS":"新思科技","IE00B3QW5Z07.USD":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (USD) ACC",".IXIC":"NASDAQ Composite","LU0444971666.USD":"天利全球科技基金","SGXZ23171101.USD":"NIKKO AM SHENTON GLOBAL OPPORTUNITIES (USD) ACC","BK4112":"金融交易所和数据"},"translate_title":"下跌的股票和坚实的基本面：市场对新思科技公司（纳斯达克：SNPS）的看法是错误的吗？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{".IXIC":1,"SNPS":1,"NDAQ":1,"NVIW.SI":0.6,"PSQ":0.6,"QID":0.6,"QLD":0.6,"SQQQ":0.6,"TQQQ":0.6,"TSYW.SI":0.6,"USAW.SI":0.6,"USJW.SI":0.6,"MNQmain":0.6,"NQmain":0.6},"content_text":"With its stock down 10% over the past month, it is easy to disregard Synopsys (NASDAQ:SNPS). However, stock prices are usually driven by a company’s financial performance over the long term, which in this case looks quite promising. In this article, we decided to focus on Synopsys'  ROE. \n Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Simply put, it is used to assess the profitability of a company in relation to its equity capital. \n View our latest analysis for Synopsys \n How Is ROE Calculated? \n ROE can be calculated by using the formula: \n Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity \nSo, based on the above formula, the ROE for Synopsys is:\n16% = US$1.4b ÷ US$9.0b (Based on the trailing twelve months to October 2024).\n The 'return' is the income the business earned over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.16 in profit. \n What Is The Relationship Between ROE And Earnings Growth? \n Thus far, we have learned that ROE measures how efficiently a company is generating its profits. We now need to evaluate how much profit the company reinvests or \"retains\" for future growth which then gives us an idea about the growth potential of the company. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features. \n Synopsys' Earnings Growth And 16% ROE \n To begin with, Synopsys seems to have a respectable ROE. Especially when compared to the industry average of 12% the company's ROE looks pretty impressive. This certainly adds some context to Synopsys' exceptional 21% net income growth seen over the past five years. However, there could also be other causes behind this growth. Such as - high earnings retention or an efficient management in place. \n Next, on comparing Synopsys' net income growth with the industry, we found that the company's reported growth is similar to the industry average growth rate of 20% over the last few years. \n\n\n\n  NasdaqGS:SNPS Past Earnings Growth December 27th 2024\n \n\n The basis for attaching value to a company is, to a great extent, tied to its earnings growth. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. Doing so will help them establish if the stock's future looks promising or ominous. Is SNPS fairly valued? This infographic on the company's intrinsic value  has everything you need to know. \n Is Synopsys Using Its Retained Earnings Effectively? \n Synopsys doesn't pay any regular dividends currently which essentially means that it has been reinvesting all of its profits into the business. This definitely contributes to the high earnings growth number that we discussed above. \n Summary \n On the whole, we feel that Synopsys' performance has been quite good. Particularly, we like that the company is reinvesting heavily into its business, and at a high rate of return. Unsurprisingly, this has led to an impressive earnings growth. That being so, a study of the latest analyst forecasts show that the company is expected to see a slowdown in its future earnings growth. To know more about the latest analysts predictions for the company, check out this visualization of analyst forecasts for the company. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.4","shortVersion":"4.29.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2494680242"}