Synopsys reported fiscal third-quarter 2026 adjusted earnings of $3.91 per share, exceeding the $3.67 per share consensus estimate, while revenue totaled $2.48 billion against a $2.44 billion forecast. The company also raised its full-year outlook following the results.
Benchmark maintained its Buy rating and $570 price target on Synopsys stock, describing the quarter as a "beat-and-raise" despite the shares falling in after-hours trading. The firm noted that artificial intelligence acts as a tailwind for the company’s electronic design automation and simulation software segments, prompting a material upward revision to near-term estimates.
Baird upgraded Synopsys to Outperform from Neutral, lifting its price target to $560 from $558. The firm cited a favorable growth trajectory, projecting a return to double-digit organic revenue growth by fiscal 2027 and potential upside in revenue and free cash flow estimates.
Synopsys’ gross profit margin stood at 82.6%, while its forward earnings multiple was 24.0 times prior to the results, the lowest in years according to Benchmark. The company’s last twelve months revenue growth reached 39.5%. Synopsys has scheduled an analyst day for September 30, 2026.
InvestingPro analysis indicated the stock appears slightly overvalued relative to its Fair Value.
