TLDR
- Piper Sandler upgraded Synopsys (SNPS) to Overweight from Neutral, raising its price target to $550 from $450
- The upgrade is driven by improving sentiment around Intel’s 18A-P and 14A manufacturing nodes
- Reports suggest Apple and Google are both tapping Intel’s foundry business, which could boost Synopsys IP licensing
- Piper raised its FY2027 EPS estimate to $17.04 and revenue forecast to $10.8 billion
- Synopsys holds a Zacks Rank #2 (Buy), with the consensus EPS estimate up 3.7% over the past month to $14.75
Piper Sandler upgraded Synopsys to Overweight on Monday and lifted its price target to $550, up from $450. That new target implies roughly 18% upside from the stock’s recent price of $464.58.
The upgrade centers on Intel’s foundry business picking up steam. Piper analyst Clarke Jeffries said sentiment around Intel’s 18A-P and future 14A manufacturing nodes has improved in recent months. Synopsys supplies design tools and IP for advanced chip development, so when foundry activity picks up, it tends to benefit directly.
The story gets more interesting when you look at who’s reportedly using Intel’s fabs. Reports indicate Apple may use Intel’s manufacturing technology for certain future chips. Google has also reportedly selected Intel for roughly half of its TPU production through 2028.
If those projects move forward, Piper expects them to drive new IP licensing and design activity — and Synopsys would be well-placed to capture that demand.
Intel Foundry as a Catalyst
Piper also flagged that capacity constraints at leading-edge foundries have made Intel’s emerging manufacturing offerings more strategically valuable. Customers looking for alternatives to heavily utilized fabs now have more reason to take Intel seriously.
That dynamic could support broader semiconductor design activity and create incremental work for Synopsys across its IP and EDA tool segments.
On the numbers side, Piper raised its FY2027 revenue forecast to $10.8 billion from $10.7 billion. Its FY2027 EPS estimate moved up to $17.04 from $16.69.
The firm did flag some risks. The upgrade depends heavily on the actual scope of customer commitments to Intel’s foundry. Intel’s 14A process is still under development, so near-term momentum leans on 18A-P. Piper also cited heightened EDA competition, potential slowdowns in semiconductor R&D spending, and global trade restrictions as things to watch.
Wall Street Broadly Bullish
Synopsys currently holds an average brokerage recommendation of 1.77 out of 5, sitting between Strong Buy and Buy. Of the 22 analyst recommendations tracked, 14 are Strong Buy and one is Buy — that’s 63.6% and 4.6% of the total, respectively.
The Zacks Consensus Estimate for the current fiscal year has climbed 3.7% over the past month to $14.75 per share. That revision trend earned Synopsys a Zacks Rank #2 (Buy).
Piper’s 18A-P-related activity is the more important near-term catalyst, according to the firm, with broader Intel foundry traction expected to build over time.
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