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Independent research · Est. October 2026
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Stock X-Ray · Technology · S&P 500 Full Coverage — Phase 1

Synopsys (SNPS)

X-Ray dated Oct 28, 2026 · Share price as of the Oct 27, 2026 close · Financials from SEC filings (EDGAR) · Valuation multiples from a labelled secondary source
The verdict — valuation label: OVERVALUED

Forward P/E is 26.86x against a peer median of 17.03x, a ratio of 1.58x — above the 1.3x overvalued threshold — with trailing P/E 84.12x. The growth exception does not clear it: latest-quarter revenue grew +42.4% year over year (PRIMARY, SEC filings/EDGAR), very strong and well above the application software cluster median of +14.9%, but short of the +50% exceptional bar, and PEG is 1.07, not below about 1. The delivered growth pays for part of the 58% premium, not all of it, and the ratio stays short of the 1.75x bubble threshold.

26.9×
Forward P/E — price vs next year’s expected earnings (secondary source)
17.0×
Peer median forward P/E — closest comparable companies
84.1×
Trailing P/E — price vs the last twelve months of earnings
9.7×
Price / sales

What would change this label: Moves to FAIRLY PRICED if revenue growth sustains at +50% YoY or better with PEG at or below about 1.0, or if the forward P/E compresses below about 19.6x (1.15x the current peer median) at unchanged growth; moves toward BUBBLE if the forward P/E rises above about 29.8x (1.75x the peer median) while growth slows below +20% YoY.

In simple words

Synopsys' shares cost about 27 times next year's expected earnings, well above similar software companies at about 17 times. Its sales grew about 42%, which is excellent and explains part of that higher price — just not all of it. On these numbers the shares are overvalued, though the strong growth keeps it well short of bubble territory.

Words we use, in plain English: P/E ratio — the share price divided by earnings per share; how many dollars you pay for one dollar of yearly profit. Forward P/E — the same, using next year’s expected earnings. Free cash flow — cash a company has left after running the business and buying equipment. TTM — the last twelve months. Drawdown — the worst fall from a peak to the low after it.
Figure 1 — The share price vs the market — six years
Synopsys (SNPS)S&P 500 (SPY)
731301872443012021202220232024202520262020-09-012026-10-27

Both lines start at 100 on 2020-09-01. Over the full window Synopsys returned +110.54% and the S&P 500 +118.28% (price returns; dividends not reinvested). Worst peak-to-trough fall for Synopsys: -43.0% (2025-07-30 to 2026-09-15). Source: Nasdaq official daily history.

What the label rests on

Forward P/E is 26.86x against a peer median of 17.03x, a ratio of 1.58x — above the 1.3x overvalued threshold — with trailing P/E 84.12x. The growth exception does not clear it: latest-quarter revenue grew +42.4% year over year (PRIMARY, SEC filings/EDGAR), very strong and well above the application software cluster median of +14.9%, but short of the +50% exceptional bar, and PEG is 1.07, not below about 1. The delivered growth pays for part of the 58% premium, not all of it, and the ratio stays short of the 1.75x bubble threshold. The company’s forward P/E is 26.9× against a peer median of 17.0×. Its own history: UNVERIFIED — no sourced range available. Sector demand read: Delivered demand check: the Application software group's median latest-quarter revenue growth was 14.9% year over year (SEC filings) — demand rising. Latest-quarter sales growth was +42.4% versus a year earlier (SEC filings).

Table 1
CompanyPrice (Oct 27, 2026)Forward P/ETrailing P/E
Synopsys (SNPS)$474.4226.9×84.1×
INTU$328.0713.8×19.9×
CDNS$336.9235.8×67.0×
ADBE$248.099.2×13.8×
DDOG$280.37105.7×571.6×
WDAY$205.4617.0×42.3×
Peer median17.0×

Multiples: stockanalysis.com (SECONDARY, S&P Global data), fetched Oct 28, 2026. Peer set chosen by sector; the median is the middle value of the set. The label and its numbers were recorded in the programme’s label registry on Oct 28, 2026 and will be scored at 6 and 12 months.

Sales, profit and cash

Figure 2 — Sales each quarter, and the gross margin
SalesGross margin (right axis)
$0B$1B$2B$3B0%49%98%Oct 2020Oct 2021Oct 2022Oct 2023Oct 2024Oct 2025Jul 2026

Gross margin = gross profit divided by sales, from SEC filings.

Figure 3 — Cash left over each quarter (free cash flow)
PositiveNegative
$-1B$0B$1BOct 2020Oct 2021Oct 2022Oct 2023Oct 2024Oct 2025Jul 2026

Free cash flow = cash from operations minus spending on plant and equipment, both from the company’s SEC cash-flow statement. Gaps are quarters where that spending line is not separately tagged in the filings — shown as gaps, never estimated.

Table 2
QuarterSalesGross marginNet incomeEPS (GAAP, diluted)Free cash flow
Q/E Jul 2026
2026-07-31
$2.5B72.6%$546M2.84$746M
Q/E Apr 2026
2026-04-30
$2.3B72.3%$17M0.09$575M
Q/E Jan 2026
2026-01-31
$2.4B73.5%$65M0.34$822M
Q/E Oct 2025
2025-10-31
$2.3B71.0%$449M—$605M
Q/E Jul 2025
2025-07-31
$1.7B78.1%$243M1.50$632M
Q/E Apr 2025
2025-04-30
$1.6B80.2%$345M2.21$220M
Q/E Jan 2025
2025-01-31
$1.5B81.5%$296M1.89$-108M
Q/E Oct 2024
2024-10-31
$1.6B77.1%$1.1B—$558M
Q/E Jul 2024
2024-07-31
$1.5B81.0%$408M2.61$415M
Q/E Apr 2024
2024-04-30
$1.5B79.3%$292M1.88$438M
Q/E Jan 2024
2024-01-31
$1.6B80.0%$449M2.89$-128M
Q/E Oct 2023
2023-10-31
$1.6B79.2%$349M—$273M

The last twelve reported quarters. Full 24-quarter history sits in the data pack behind this page. A dash means the figure is not tagged as a standalone quarter in the company’s SEC facts (the usual case is the fourth quarter, which many companies only report inside the full-year filing) — it is missing, not zero.

Earnings: getting better or worse?

Each box is one quarter’s earnings per share (EPS). Green means EPS was higher than the same quarter a year earlier; red means lower; a dash means the figure is not tagged in the filings.

Oct 2022
—
Jan 2023
1.75
Apr 2023
1.76
Jul 2023
2.17
Oct 2023
—
Jan 2024
2.89
Apr 2024
1.88
Jul 2024
2.61
Oct 2024
—
Jan 2025
1.89
Apr 2025
2.21
Jul 2025
1.50
Oct 2025
—
Jan 2026
0.34
Apr 2026
0.09
Jul 2026
2.84

Basis: GAAP diluted EPS from SEC company facts, compared with the same quarter a year earlier.

Key facts

Table 3
ItemValue
Company (legal name in filings)SYNOPSYS INC
Chief executiveSassine Ghazi (source: https://www.synopsys.com/company/management-team/sassine-ghazi-bio.html)
SectorTechnology — Application Software — sells electronic design automation software used to design chips and systems
Share price (Oct 27, 2026)$474.42
Market value (market cap)$90.9B — share price times shares outstanding of 191,636,646 (SEC filings; SEC EDGAR dei EntityCommonStockSharesOutstanding (latest))
Sales, last twelve months$9.4B
Net income, last twelve months$1.1B
Free cash flow, last twelve months$2.7B
Latest reported quarterQ/E Jul 2026 (of 24 quarters in the data pack)
Six-year price return vs S&P 500+110.54% vs +118.28%
Worst peak-to-trough fall-43.0% (2025-07-30 to 2026-09-15)

What we could not verify

  • TTM GAAP diluted EPS could not be summed from company facts because at least one of the last four quarters (typically Q4) has no standalone tagged EPS; trailing P/E is therefore taken from the labelled secondary source in valuation_label.md.
  • Own-history P/E range not yet compiled for this company in the Phase 1 batch run; the label rests on peer-median, growth and PEG evidence.
  • Brief fetch note: browser.open of the statistics page failed with a 429 rate-limit error; values were recorded from the stockanalysis.com Statistics & Valuation result returned by browser.search.
  • Guidance record (each quarter scored against the guidance the company gave the quarter before) is not yet compiled for this company — it is a Phase 2 layer. The earnings strip below therefore uses reported EPS versus a year earlier, which is fully sourced from filings.

The IT factor — the most exciting thing the market is overlooking — is not assessed on an X-Ray page. It belongs to the Deep Dive (Phase 2), where it gets the evidence standard it needs. Leadership-era scoring (the six years split by chief executive) is likewise a Phase 2 layer; this page names the current chief executive only, from a sourced profile.

Sources

  • SEC EDGAR submissions — Filing index; company legal name. https://data.sec.gov/submissions/CIK0000883241.json
  • SEC EDGAR company facts — Quarterly financial spine: revenue, gross profit, net income, GAAP diluted EPS, operating cash flow, PP&E capex, buybacks, dividends, diluted shares. https://data.sec.gov/api/xbrl/companyfacts/CIK0000883241.json
  • Nasdaq official daily history — Daily closes for the company; SPY (assetclass=etf) saved as raw/nasdaq_spy_raw.json over identical dates. https://api.nasdaq.com/api/quote/SNPS/historical?assetclass=stocks
  • Valuation multiples and peer figures — stockanalysis.com (SECONDARY, S&P Global data), fetched Oct 28, 2026; see valuation_label.md in the data pack.

Conventions: earliest-filed value per period, as first reported; cash-flow years-to-date differenced quarter by quarter; EPS never differenced; free cash flow = operating cash flow minus plant-and-equipment spending. This page is a dated snapshot — updates are new versions, never silent edits.

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