Synopsys Stock Testing Price Floor – Buy Now?

December 2nd, 2025 by Trefis Team
SNPS: Synopsys logo
SNPS
Synopsys

Synopsys (SNPS) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($416.38 – $460.20), levels from which it has bounced meaningfully before. In the last 10 years, Synopsys stock received buying interest at this level 5 times and subsequently went on to generate 28.5% in average peak returns.

  Peak Return Days to Peak Return
5/18/2023 13.5% 12
6/26/2023 11.0% 22
8/9/2023 44.8% 331
4/9/2025 50.5% 112
9/15/2025 22.8% 7

Yet, a support zone alone isn’t enough; rebounds are more likely when fundamentals, sentiment, and market conditions line up. How does that look for SNPS?

Rebound Likely: AI/EDA tailwinds, Nvidia deal outweigh IP weakness.

Synopsys sits near its 52-week low with recent Q3 EPS miss and IP business challenges. However, the strategic $2 billion Nvidia investment and partnership, announced December 1, 2025, coupled with the Ansys acquisition, significantly bolster its AI-driven EDA and silicon-to-systems capabilities, addressing key industry tailwinds. Analyst average targets indicate substantial upside despite some recent reductions. Projected Q4 2025 and Q1 2026 revenue growth exceeding 35% and 65% respectively, signals robust forward momentum, outweighing temporary IP segment weakness and lawsuit overhang.

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How Do SNPS Financials Look Right Now?

  • Revenue Growth: 8.0% LTM and 9.7% last 3-year average.
  • Cash Generation: Nearly 20.2% free cash flow margin and 17.2% operating margin LTM.
  • Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for SNPS was -3.1%.
  • Valuation: SNPS stock trades at a PE multiple of 41.1

  SNPS S&P Median
Sector Information Technology –
Industry Application Software –
PE Ratio 41.1 23.5
   
LTM* Revenue Growth 8.0% 6.1%
3Y Average Annual Revenue Growth 9.7% 5.4%
Min Annual Revenue Growth Last 3Y -3.1% 0.2%
   
LTM* Operating Margin 17.2% 18.8%
3Y Average Operating Margin 21.6% 18.2%
LTM* Free Cash Flow Margin 20.2% 13.5%

*LTM: Last Twelve Months | For more details on SNPS fundamentals, read Buy or Sell SNPS Stock.

And What If The Support Breaks?

SNPS isn’t immune to big drops. It fell 61% in the Dot-Com bubble and nearly 49% during the Global Financial Crisis. Even more recent shocks like Covid and inflation knocked it down about 30-35%. The 2018 correction wasn’t gentle either, with a 23% dip. Strong fundamentals don’t stop sharp sell-offs when the market turns sour. Risk remains, even for solid names.

Still not sure about SNPS stock? Consider the portfolio approach.

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