Bank of America has revised its price target for Synopsys (SNPS, Financial), bringing it down to $560 from the previous $630 while maintaining a Buy rating on the stock. The adjustment is part of broader expectations that despite potentially surpassing initial forecasts in the first quarter, U.S. chip vendors face challenges ahead due to tariff-related factors.
The firm indicates that initial outlooks were conservative, with tariff-related demand unexpectedly boosting the market environment. However, looking ahead, they foresee scenarios where tariffs could significantly impact sales. In a moderate tariff situation, average sales could decline by 4% to 6%. In a more severe scenario, sales might drop by 9% in 2025 and 12% in 2026 on average.
Bank of America also notes that under a moderate tariff scenario, earnings per share could see a reduction of 12% to 13%. This outlook prompted the firm to lower their targets across the semiconductor sector due to rising uncertainty.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 21 analysts, the average target price for Synopsys Inc (SNPS, Financial) is $600.25 with a high estimate of $707.78 and a low estimate of $496.12. The average target implies an upside of 41.02% from the current price of $425.65. More detailed estimate data can be found on the Synopsys Inc (SNPS) Forecast page.
Based on the consensus recommendation from 20 brokerage firms, Synopsys Inc's (SNPS, Financial) average brokerage recommendation is currently 1.8, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Synopsys Inc (SNPS, Financial) in one year is $615.96, suggesting a upside of 44.71% from the current price of $425.65. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Synopsys Inc (SNPS) Summary page.
