Synopsys SNPS is scheduled to report fourth-quarter fiscal 2024 results on Dec. 4, after market close.
Synopsys expects non-GAAP earnings per share between $3.27 and $3.32. The Zacks Consensus Estimate for fiscal fourth-quarter earnings is pinned at $3.29 per share, which indicates a year-over-year increase of 3.8%.
The company anticipates revenues between $1.614 billion and $1.644 billion for the fiscal fourth quarter. The Zacks Consensus Estimate is pegged at $1.63 billion, which suggests growth of 2.1% from the year-ago period's reported figure.
In the trailing four quarters, SNPS’ earnings surpassed the Zacks Consensus Estimate thrice while missing the same on one occasion, with an average surprise of 2.9%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Synopsys, Inc. Price and EPS Surprise
Synopsys, Inc. price-eps-surprise | Synopsys, Inc. Quote
Factors Influencing Synopsys’ Q4 Results
Synopsys’ fiscal fourth-quarter performance is likely to have reflected benefits from the escalating demand for its extensive product portfolio. The urgent need for high-performance cloud computing, propelled by the evolving hybrid work environment, is anticipated to have boosted demand for the company's Intellectual Property (IP) solutions, such as the industry’s first complete UCIe IP solution operating at up to 40 Gbps per pin to meet the high compute demands of the fastest artificial intelligence (AI) data centers.
Increased adoption of Synopsys.ai among chip manufacturers and vendors is anticipated to have boosted top-line growth during the reported quarter. Additionally, the long-term collaboration with TSMC aimed to deliver advanced EDA and IP solutions on TSMC’s most advanced process and 3DFabric technologies to accelerate innovation for AI and multi-die designs is expected to have been a major positive.
The surge in global design activity and heightened user engagement are expected to have significantly driven SNPS’ performance in the fiscal fourth quarter. Growing adoption of its interface and foundation IP solutions, along with contract wins and the use of the Fusion Platform, including the Fusion Compiler, is anticipated to have positively impacted SNPS’ fiscal fourth-quarter performance.
The increasing use of AI, IoT, 5G and cloud technology is likely to have driven demand for Synopsys’ solutions in the fiscal fourth quarter. Additionally, robust design investments in Synopsys’ ARC processors by automotive companies, as well as the strong adoption of security solutions for interfaces like CXL, PCI Express and DDR, are likely to aid its fourth-quarter results.
However, rising competition from companies, such as Cadence Design Systems, might have posed challenges for Synopsys. Moreover, tightening budgets among corporations due to ongoing macroeconomic challenges and unfavorable currency exchange rates are expected to have partially offset the positive impacts of the aforementioned growth factors
What Our Proven Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
SNPS has an Earnings ESP of 0.00% and carries a Zacks Rank #4 (Sell) at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With Favorable Combination
Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.
Rubrik RBRK has an Earnings ESP of +0.42% and carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
It is set to report third-quarter fiscal 2025 results on Dec. 5. The Zacks Consensus Estimate for RBRK’s third-quarter loss per share is pegged at 40 cents, unchanged over the past 60 days. RBRK shares have risen 37.3% year to date.
Pure Storage PSTG has an Earnings ESP of +2.98% and carries a Zacks Rank #3 at present.
It is set to report third-quarter fiscal 2025 results on Dec. 3. The Zacks Consensus Estimate for PSTG’s third-quarter earnings is pegged at 43 cents per share, unchanged over the past 60 days, indicating a decline of 14% from the year-ago quarter’s reported figure. PSTG shares have gained 48.6% year to date.
Hewlett Packard Enterprise HPE has an Earnings ESP of +1.51% and carries a Zacks Rank #3 at present.
It is set to report fourth-quarter results on Dec. 5. The Zacks Consensus Estimate for HPE’s fourth-quarter fiscal 2024 earnings is pegged at 55 cents per share, unchanged over the past 60 days, indicating an improvement of 5.8% from the year-ago quarter’s reported figure. HPE shares have risen 24.9% year to date.
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Synopsys, Inc. (SNPS) : Free Stock Analysis Report
Hewlett Packard Enterprise Company (HPE) : Free Stock Analysis Report
Pure Storage, Inc. (PSTG) : Free Stock Analysis Report
Rubrik, Inc. (RBRK) : Free Stock Analysis Report
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