Synopsys Plunges 20% in 6 Months: Should You Buy the Dip?

Stock Performance - Synopsys shares plunged 20 1% over the past six months, underperforming the Zacks Computer and Technology sector's growth of 1 1% and the S&P 500 index's growth of 3 8% [1] - The stock also underperformed the Zacks Computer - Software industry's decline of 3 3% [1] - Synopsys is trading near its 52-week low of $492 54 [1] Key Challenges - Synopsys' IP and hardware revenues are uneven due to customer product adoption schedules and capacity constraints for deploying hardware in data centers [2] - Sluggish recovery in mobile, PC, and automotive markets, which are vital for Synopsys' customer base, due to global supply chain disruptions and inflationary pressures [4] - US-China trade tensions and export controls add uncertainty, as China accounts for over 15$1 45B, with a year-over-year growth estimate of -11 90% [18] - Next quarter (4/2025) sales estimate is $1 60B, with a year-over-year growth estimate of 9 78$6 77B, with a year-over-year growth estimate of 8 04% [18] - EPS estimates for current quarter (1/2025) are $2 81, with a year-over-year growth estimate of -21 07$3 37, with a year-over-year growth estimate of 12 33% [18] - Current year (10/2025) EPS estimate is $14 90, with a year-over-year growth estimate of 12 88% [18] Conclusion - Synopsys' 20% decline over the past six months highlights near-term challenges, but strong fundamentals and technological leadership underscore long-term potential [19] - Existing investors may consider holding the stock, while new investors could wait for a better entry point [20]