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Synopsys Financial Strength

: 8 (As of Apr. 2022)
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Synopsys has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.

Good Sign:

Synopsys Inc shows strong financial strength.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Synopsys's Interest Coverage for the quarter that ended in Apr. 2022 was 910.03. Synopsys's debt to revenue ratio for the quarter that ended in Apr. 2022 was 0.13. As of today, Synopsys's Altman Z-Score is 11.48.


Competitive Comparison

For the Software - Infrastructure subindustry, Synopsys's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Synopsys Financial Strength Distribution

For the Software industry and Technology sector, Synopsys's Financial Strength distribution charts can be found below:

* The bar in red indicates where Synopsys's Financial Strength falls into.



Synopsys Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Synopsys's Interest Expense for the months ended in Apr. 2022 was $-0 Mil. Its Operating Income for the months ended in Apr. 2022 was $364 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Apr. 2022 was $625 Mil.

Synopsys's Interest Coverage for the quarter that ended in Apr. 2022 is

Interest Coverage=-1*Operating Income (Q: Apr. 2022 )/Interest Expense (Q: Apr. 2022 )
=-1*364.012/-0.4
=910.03

The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Synopsys Inc has enough cash to cover all of its debt. Its financial situation is stable.

2. Debt to revenue ratio. The lower, the better.

Synopsys's Debt to Revenue Ratio for the quarter that ended in Apr. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Apr. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(55.17 + 625.092) / 5116.916
=0.13

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Synopsys has a Z-score of 11.48, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 11.48 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Synopsys  (NAS:SNPS) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Synopsys has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.


Synopsys Financial Strength Related Terms

Thank you for viewing the detailed overview of Synopsys's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Synopsys Business Description

Synopsys logo
Address
690 East Middlefield Road, Mountain View, CA, USA, 94043
Synopsys is a provider of electronic design automation (EDA) software, intellectual property (IP), and software integrity (SI) products. EDA software automates the chip design process, enhancing design accuracy, productivity, and complexity in a full-flow end-to-end solution. The firm's growing SI business allows customers to continuously manage and test the code base for security and quality. Synopsys' comprehensive portfolio is benefiting from a mutual convergence of semiconductor companies moving up-stack toward systems-like companies, and systems companies moving down-stack toward in-house chip design. The resulting expansion in EDA customers alongside secular digitalization of various end markets benefits EDA vendors like Synopsys.
Executives
Casper Marc N director C/O THERMO FISHER SCIENTIFIC 168 THIRD AVENUE WALTHAM MA 02451
Borgen Luis director 58 SUNSET RIDGE LANE BOLTON MA 01740
Sargent Jeannine P director C/O VEECO INSTRUMENTS INC. 100 SUNNYSIDE BOULEVARD SUITE B WOODBURY NY 11797
Ghazi Sassine officer: Chief Operating Officer 3075 W RAY ROAD, SUITE 528 THE PARK AT SAN TAN CHANDLER AZ 85226
Johnson Mercedes director MICRON TECHNOLOGY, INC 8000 S FEDERAL WAY, MS 1-557 BOISE ID 83716
Kankanwadi Sudhindra officer: VP and Corporate Controller 690 E MIDDLEFIELD ROAD MOUNTAIN VIEW CA 94043
Vallee Roy director 2211 S 47TH ST PHOENIX AZ 85034
Schwarz John director 20330 STEVENS CREEK BLVD. CUPERTINO CA 95014
Nikias Chrysostomos L director UNIVERSITY OF SOUTHERN CALIFORNIA 3551 TROUSEDALE, BOVARD ADM 102 LOS ANGELES CA 90089-4019
Walske Steven director C/O PARAMETRIC TECHNOLOGY CORP 128 TECHNOLOGY DR WALTHAM MA 02154
Logan Joseph W officer: EVP, Sales & Corp Marketing 700 EAST MIDDLEFIELD ROAD MOUNTAIN VIEW CA 94043
Coleman Deborah A director 1414 SW 3RD AVENUE #2701 FTN PLAZA PORTLAND OR 97201-6627
De Geus Aart director, officer: Chairman of the Board & Co-CEO
Beattie Brian M officer: EVP, Business Ops. & CAO 875 MAHLER RD STE 280 BURLINGAME CA 94010
Chan Chi-foon director, officer: Co-CEO & President

Synopsys Headlines

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