Update shared on02 Sep 2025
Fair value Increased 2.39%Analysts raised Synopsys’ price target to $644.78 on the completion of the $35B Ansys acquisition, anticipated synergies in advanced semiconductor design, and removal of regulatory overhangs, reflecting increased confidence in the company’s strategic outlook.
Analyst Commentary
- Closure and approval of the $35B Ansys acquisition, resulting in anticipated product synergies and expanded capabilities in advanced semiconductor design.
- Ansys’s leadership in simulation tools, with strong positioning and significant (~15%) exposure to the semiconductor market.
- The completion of the Ansys transaction is expected to enable Synopsys to address growing complexities in semiconductor design, such as multi-die packages and thermal management.
- Removal of China export restrictions as an overhang, clearing regulatory uncertainties and renewing analyst confidence.
- Bullish analysts cite strategic benefits, model upgrades, and continued recommendation to build positions as drivers for higher price targets.
What's in the News
- China's market regulator has conditionally approved Synopsys' acquisition of Ansys, following the US lifting export restrictions for chip design software; Synopsys must maintain existing contracts and supply terms for Chinese clients (Reuters).
- Synopsys and SiMa.ai expanded their collaboration to accelerate AI innovation in the automotive sector, focusing on energy-efficient machine learning IP and advanced ADAS/IVI chiplet architectures, with early access in 2026 and production by mid-2027 (Key Developments).
- Synopsys signed an MoU with Tata Elxsi to co-develop advanced automotive virtualization solutions—including virtual ECUs and digital twins—to enable faster, safer software-defined vehicle development for global OEM and Tier 1 customers (Key Developments).
- Synopsys was added to numerous major value-focused indices, including Russell 3000E Value, Russell 1000 Value, and Russell Top 200 Value, highlighting increased inclusion in value benchmarks (Key Developments).
- Extensive new partnerships include collaborations with Broadcom to demonstrate PCIe 6.x interoperability for AI and HPC infrastructure, with Plug and Play to support semiconductor startups, and with Keysight to launch an AI-powered analog/RF chip design migration tool, strengthening Synopsys' market and technology leadership (Key Developments).
Valuation Changes
Summary of Valuation Changes for Synopsys
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $637.51 to $644.78.
- The Future P/E for Synopsys has significantly fallen from 57.66x to 48.79x.
- The Discount Rate for Synopsys remained effectively unchanged, moving only marginally from 8.69% to 8.68%.
Disclaimer
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