Nvidia (NVDA) is sure to pop up in any discussion of the top AI stocks to watch.but don’t ignore Synopsys (SNPS), Nvidia’s primary partner.after having earned a place IBD Long-Term Leader From its low point in 2008 to the end of last year, the list had an approval rating of 3,594%. Synopsys Stock If the market cooperates, be ready to enter a new buying zone.
Like Nvidia, strong demand for Synopsys from institutions is driving strong demand for all things artificial intelligence.Except for solid B Accumulate/issue ratingsOf those, 52 funds with IBD A+ ratings own Synopsys stock.
Although it doesn’t join Nvidia’s ranks The 100 Best Stocks of 2023Last year, Synopsys achieved a 65% gain. While Nvidia has been chasing beyond buy range, Synopsys continues to create new potential breakouts.
AI megatrend prompts Synopsys to acquire Ansys
Headquartered in Sunnyvale, Calif., Synopsys provides software and systems designed to simulate and verify semiconductor designs and prototypes, provide software for autonomous vehicles and learning machines, and support the communications and data transfer required by cloud-based applications.
At the beginning of this month, Synopsys announces it will acquire ANSYS (autonomous navigation system), developing engineering simulation software applications for design analysis and prototype evaluation.
The deal addresses megatrends in artificial intelligence, chip proliferation and increasingly complex software-defined systems. Based on the closing price of Synopsys common stock on December 21, Synopsys valued the acquisition at approximately $35 billion.
Synopsys shares rise, Nvidia still near all-time highs
with its relative strength line Nvidia shares have soared, surpassing the 600-point mark, and continue to trade near all-time highs.
While the right side of that bottom formed this month, notice how the stock surged higher in a matter of days. This trend indicates demand. Synopsys fell on Wednesday as the Nasdaq pulled back, but remained above its 50-day moving average.
Synopsys will face its next profitability test on February 21st.
The stock hit an all-time high on Nov. 29 after beating fiscal fourth-quarter expectations. Synopsys reported earnings of $3.17 per share, up 66% from the same period last year, marking an acceleration in growth in the second quarter. Revenue rose 25% to less than $1.6 billion. This marks an accelerated growth in the third season.
Synopsys stock analysts forecast profit growth of 39% for the current quarter and 83% for the full year.
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