Synopsys Short Interest Plummets 19.8% Amid Insider Sales

Synopsys, Inc. (NASDAQ: SNPS) experienced a notable decline in short interest, with a reduction of 19.8% in August. As of August 31, 2023, the short interest totaled 3,240,000 shares, down from 4,040,000 shares on August 15, 2023. This decrease reflects approximately 2.1% of the company’s outstanding shares. Based on an average trading volume of 1,890,000 shares, the days-to-cover ratio stands at 1.7 days.

Insider Trading Activity

Recent transactions by company executives have sparked interest among investors. Chief Financial Officer Shelagh Glaser sold 3,655 shares on September 5, 2023, at an average price of $609.77, totaling $2,228,709.35. Following this sale, she holds 15,317 shares valued at about $9,339,847.09, marking a 19.27% reduction in her stake.

Similarly, Chief Executive Officer Sassine Ghazi sold 11,366 shares on September 2, 2023, for an average price of $589.01, amounting to $6,694,687.66. After this transaction, Ghazi retains 71,615 shares worth approximately $42,181,951.15, a decrease of 13.70% in his position. Currently, insiders own 0.62% of the company’s stock.

Institutional Investor Movements

In addition to executive sales, several institutional investors have recently adjusted their holdings in Synopsys. Brighton Jones LLC increased its stake by 5.7% in the fourth quarter, now holding 921 shares valued at $447,000 after acquiring an additional 50 shares. Woodline Partners LP entered a new position valued at approximately $8,453,000 during the same period.

Other notable transactions include Williams Jones Wealth Management LLC raising its position by 0.5%, now owning 4,650 shares worth $2,257,000, and Waverly Advisors LLC boosting its holdings by 447.6%, acquiring 3,523 additional shares for a total of 4,310 shares valued at $2,092,000. Overall, hedge funds and institutional investors control approximately 85.47% of Synopsys’s stock.

Analyst Ratings and Market Performance

Equity analysts have recently reassessed their outlook on Synopsys. On September 10, 2023, JPMorgan Chase & Co. lowered its price target from $685.00 to $600.00, maintaining an “overweight” rating. Rosenblatt Securities reaffirmed a “neutral” rating with a target price of $605.00, down from $650.00. Similarly, Citigroup downgraded its rating from “neutral” to “underperform.”

Further rating adjustments came from Stifel Nicolaus, which reduced its target from $650.00 to $550.00, and Baird R W, which changed its stance from “strong-buy” to “hold.” Collectively, eleven analysts have rated the stock as a Buy, four have issued a Hold rating, and three have given it a Sell rating. According to MarketBeat, Synopsys currently holds a consensus rating of “Hold” with a price target of approximately $585.33.

As of Friday, shares of Synopsys opened at $495.50. The company has a market capitalization of $92.04 billion and a price-to-earnings (P/E) ratio of 38.89. Its twelve-month trading range has seen a low of $365.74 and a high of $651.73.

Synopsys continues to be a significant player in the electronic design automation industry, with operations spanning three segments: Design Automation, Design IP, and Software Integrity. The firm is known for its solutions in digital and custom integrated circuit design as well as verification and FPGA design products.