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How Does Synopsys Compare to Its Peers?

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Dec. 3 2015, Published 8:02 a.m. ET

Synopsys and its peers

In this article, we’ll compare Synopsys with its peers. The PE (price-to-earnings) ratios of Synopsys (SNPS), Ansys (ANSS), Cadence Design Systems (CDNS), and Mentor Graphics (MENT) are 33.1x, 34.0x, 29.2x, and 14.3x, respectively, as of December 2, 2015.

Additionally, the PBV (price-to-book value) ratios of Synopsys, Ansys, Cadence Design Systems, and Mentor Graphics are 2.5x, 3.8x, 4.6x, and 1.6x, respectively.

According to these findings, the peers of Synopsys are ahead of it based on PBV. However, Synopsys has outperformed most of its peers based on PE.

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ETFs that invest in Synopsys

The PowerShares Dynamic Software Portfolio ETF (PSJ) invests 2.8% of its holdings in Synopsys.

Next, the iShares S&P North American Technology-Software ETF (IGV) invests 1.7% of its holdings in Synopsys. The ETF tracks a market-cap-weighted index of US and Canadian software companies.

Also, the PowerShares S&P MidCap Low Volatility Portfolio (XMLV) invests 1.3% of its holdings in Synopsys. The ETF tracks a volatility-weighted index of the 80 least volatile S&P MidCap 400 companies.

Comparing Synopsys and its ETFs

Here, let’s compare Synopsys with the ETFs that invest in it:

  • The year-to-date price movements of Synopsys, PSJ, IGV, and XMLV are 15.1%, 10.9%, 15.2%, and 8.6%, respectively.
  • The PE ratios of Synopsys, PSJ, IGV, and XMLV are 33.1x, 28.8x, 57.9x, and 21.3x, respectively.
  • The PBV ratios of Synopsys, PSJ, IGV, and XMLV are 2.5x, 4.5x, 5.4x, and 2.4x, respectively.

According to the findings above, the ETFs outperformed Synopsys based on PBV. However, Synopsys outperformed most of its ETFs based on price movement and PE.

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