PQUS0.560%
as of Sep 1
SNPS
GrowthSYNOPSYS INC
Synopsys, Inc. provides design IP solutions in the semiconductor and electronics industries. It operates in two segments, Design Automation and Design IP. The company offers Digital and Custom IC Design solution that provides digital design implementation solutions; Verification solution that offers virtual prototyping, static and formal verification, simulation, emulation, field programmable gate array (FPGA)-based prototyping, and debug solutions; FPGA design products that are programmed to perform specific functions; synopsys technology computer-aided design (TCAD), mask synthesis, and manufacturing analytic solutions; and AI-driven EDA solutions.
Close · 3M
-5.05%
Held by 2 AI ETFs
AIEQ0.050%
as of Sep 4
Signal performance
Each tracked ETF's moves on this stock, grouped by fund. Returns are measured from the signal date to the latest close — hypothetical, no commissions or slippage.
Buy signals4
Win rate50% (2/4)
Avg buy return-1.69%
PQUS · Weight decrease · 3d
weight 0.800% → 0.600% (-0.200 pp)·stock up 6.5% in the 30 days before
Aug 21·entry $397.87·now $416.31
+4.63%
since Aug 21
PQUS · Weight decrease · 2d
weight 0.800% → 0.780% (-0.020 pp)·stock up 5.4% in the 30 days before
Aug 20·entry $397.92·now $416.31
+4.62%
since Aug 20
PQUS · Weight decrease · 2d
weight 0.840% → 0.780% (-0.060 pp)·stock up 1.1% in the 30 days before
Aug 15·entry $413.22·now $416.31
+0.75%
since Aug 15
PQUS · Weight increase · 2d
weight 0.710% → 0.850% (+0.140 pp)·stock down 6.2% in the 30 days before
Aug 8·entry $411.68·now $416.31Fresh
+1.12%
since Aug 8
PQUS · Weight increase · 2d
weight 0.660% → 0.710% (+0.050 pp)·stock down 14.5% in the 30 days before
Jul 31·entry $388.76·now $416.31Drifting
+7.09%
since Jul 31
PQUS · Sudden change · 1d
weight 0.280% → 0.660% (+0.380 pp)·stock down 19.5% in the 30 days before
Jul 26·entry $388.99·now $416.31
+7.02%
since Jul 26
PQUS · New entry · 1d
weight 0 → 0.200% (new)·stock down 6.3% in the 30 days before
Jul 10·entry $445.50·now $416.31Fresh
-6.55%
since Jul 10
PQUS · Exit · 1d
weight 0.120% → 0 (exited)·stock up 21.7% in the 30 days before
Apr 30·entry $482.60·now $416.31
-13.74%
since Apr 30
AIEQ · New entry · 1d
weight 0 → 0.050% (new)·stock down 8.9% in the 30 days before
Jul 1·entry $454.53·now $416.31Fresh
-8.41%
since Jul 1
AIEQ · Exit · 1d
weight 0.510% → 0 (exited)·stock down 1.2% in the 30 days before
May 30·entry $492.29·now $416.31
-15.43%
since May 30
AIEQ · Weight decrease · 3d
weight 0.590% → 0.500% (-0.090 pp)·stock up 23.3% in the 30 days before
May 3·entry $497.50·now $416.31
-16.32%
since May 3
AIEQ · Weight decrease · 2d
weight 0.590% → 0.570% (-0.020 pp)·stock up 21.7% in the 30 days before
Apr 30·entry $482.60·now $416.31
-13.74%
since Apr 30
Sell signals show what the stock did after the AI exited. A negative number means the AI's exit was well-timed.
Buffett-style framework
Fails the frameworkas of Aug 16
AI ETFs PQUS and AIEQ currently hold Synopsys, with PQUS exhibiting recent mixed signals of increasing and decreasing its position. This contrasts with a 'Fail' verdict from a Buffett-style framework, which points to financial health and valuation concerns, suggesting the company is not an attractive value investment despite AI interest.
- Circle of CompetenceDespite the technical nature of the industry, Synopsys's role as a foundational provider of mission-critical EDA software and IP, with recurring revenue, suggests reasonably predictable unit economics over a decade.
- Economic MoatSynopsys benefits from significant switching costs for its integrated design solutions, a scale-driven advantage in R&D, and extensive intellectual property, creating a durable economic moat in the EDA market.
- ManagementThe provided financial data does not offer sufficient information to assess management's candor, capital allocation discipline, or personal investment in the company.
- Financial HealthThe company's reported Return on Equity of 2.64% falls significantly short of the required 10-year average of 15% and a minimum of 10% in any single year, indicating poor capital efficiency.
- Margin of SafetyWith a P/E of 101.7 and EV/EBITDA of 80.13, combined with low ROE, the current price offers no defensible margin of safety relative to a conservative estimate of intrinsic value.
Synopsys operates within a predictable circle of competence and possesses a strong economic moat due to high switching costs and R&D scale advantages in the semiconductor design industry. However, the analysis highlights significant concerns regarding its financial health, specifically a very low return on equity of 2.64% which fails a key framework criterion. Furthermore, the company's high valuation multiples, including a P/E over 100, suggest no margin of safety, making it an unfavorable investment from this perspective.
Educational interpretation generated by AI applying frameworks Warren Buffett documented in his shareholder letters and other public writings. Not a statement by Mr. Buffett or Berkshire Hathaway, and not investment advice.