Wed, January 17, 2024 at 1:39 AM PST·2 min read
Synopsys SNPS shares rallied 3.1% in the last trading session to close at $509.68. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 11.7% loss over the past four weeks.
The upswing came after Synopsys announced that it has entered into a definitive agreement to acquire ANSYS Inc. in a deal worth $35 billion. The combination will create a formidable entity in chip design and simulation software. The acquisition positions Synopsys to cater to a broader market, spanning from semiconductors to complex machinery and automation, fueled by the growing influence of artificial intelligence.
This maker of software used to test and develop chips is expected to post quarterly earnings of $3.41 per share in its upcoming report, which represents a year-over-year change of +30.2%. Revenues are expected to be $1.65 billion, up 20.9% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Synopsys, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on SNPS going forward to see if this recent jump can turn into more strength down the road.
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Synopsys SNPS shares rallied 3.1% in the last trading session to close at $509.68. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 11.7% loss over the past four weeks.
The upswing came after Synopsys announced that it has entered into a definitive agreement to acquire ANSYS Inc. in a deal worth $35 billion. The combination will create a formidable entity in chip design and simulation software. The acquisition positions Synopsys to cater to a broader market, spanning from semiconductors to complex machinery and automation, fueled by the growing influence of artificial intelligence.
This maker of software used to test and develop chips is expected to post quarterly earnings of $3.41 per share in its upcoming report, which represents a year-over-year change of +30.2%. Revenues are expected to be $1.65 billion, up 20.9% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Synopsys, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on SNPS going forward to see if this recent jump can turn into more strength down the road.
Synopsys (SNPS) Surges 3.1%: Is This an Indication of Further Gains?
Synopsys (SNPS) witnessed a jump in share price last session on above-average trading volume. The latest trend in earnings estimate revisions for the stock doesn't suggest further strength down the road.