Synopsys: 50% Upside In Sight

Picture Credit: Synopsys

• The electronic design automation (EDA) industry is set to grow. The semiconductor IP industry is also expecting growth.
• Synopsys is the number one EDA company. It is also branching out into the semiconductor IP industry, and hence it is exposed to the growth of both.
• It is positioned to capitalize on the growth of emerging markets and the automotive IC industry. IC node-shrinkage brings further benefits.
• PE and cash flow based valuations reveal an upside of around 50% in the next couple of years.

Synopsys (SNPS) is a technology company that belongs to the industry of semiconductor equipment and materials. The company provides electronic design automation, or EDA, software that is used by the designers of integrated circuits; commonly known as chips. The company also provides semiconductor intellectual property, or IP, products. They are pre-designed circuits that can be used by chip makers as a component of a larger chip design. Synopsys also provides related services. The company generated63% of its revenue from core EDA services in the fiscal year 2013. The semiconductor IP made up around 25% of the revenue. These are the main revenue drivers of the company.

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