Chip-design software firm Synopsys (SNPS) is back in focus after Nvidia (NVDA) invested $2 billion to expand its AI partnership. After the announcement, Mizuho analyst Siti Panigrahi reiterated an Outperform rating and a $600 price target, which points to about 37% upside from current levels.
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Importantly, the deal brings Synopsys’ chip design tools together with Nvidia’s AI and accelerated computing platform to help speed up chip development and testing.
Why the Analyst Thinks the Deal Matters
Panigrahi said the new partnership puts Synopsys in a stronger position in chip design. Running Synopsys tools on Nvidia’s AI platform should help chipmakers design and test chips faster, especially in slower steps like simulation and verification.
The analyst also highlighted Nvidia’s $2 billion stake, which equals roughly 2.5% of Synopsys shares. Panigrahi sees this as a strong signal that Nvidia believes Synopsys will play an important role in the next phase of AI-driven chip development. The agreement is non-exclusive, but still notable because it links the companies through both technology and ownership.
Panigrahi added that Synopsys’ core growth drivers remain intact, and the partnership should help the company reach more customers as demand rises for AI-powered chip design tools.
Is SNPS Stock a Buy, Sell, or Hold?
Currently, Wall Street has a Moderate Buy consensus rating on Synopsys stock based on 12 Buys, three Holds, and two Sell recommendations. The average SNPS stock price target of $554.41 indicates 26.49% upside potential.
