Hold Rating for Synopsys Amid Geopolitical Risks and Market Stability Concerns

Joseph Quatrochi, an analyst from Wells Fargo, maintained the Hold rating on Synopsys (SNPS – Research Report). The associated price target is $520.00.

Joseph Quatrochi has given his Hold rating due to a combination of factors influencing Synopsys’s current market position. One key consideration is the potential impact of geopolitical tensions, particularly the risk associated with possible restrictions on sales to China, which represents a significant portion of Synopsys’s revenue. Although Synopsys has not yet received a letter from the BIS regarding these restrictions, the uncertainty remains a concern.
Additionally, while Synopsys’s acquisition of Ansys is on track to close in the first half of 2025, the market is expected to remain stable until the deal is finalized. Despite strong demand in AI design activities, the company faces subdued conditions in non-AI markets, with only slight improvements anticipated. These factors, combined with minor adjustments in revenue and EPS estimates, contribute to the decision to maintain a Hold rating, reflecting expectations of a range-bound stock performance in the near term.

According to TipRanks, Quatrochi is a 5-star analyst with an average return of 14.9% and a 59.29% success rate. Quatrochi covers the Technology sector, focusing on stocks such as Applied Materials, MKS Instruments, and ON Semiconductor.