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AVGO vs SNPS

AVGO
Broadcom Inc.
NEUTRAL
Price
$350.63
Market Cap
$1.66T
Sector
Technology
AI Confidence
85%
SNPS
Synopsys, Inc.
NEUTRAL
Price
$389.83
Market Cap
$73.17B
Sector
Technology
AI Confidence
65%

Valuation

P/E Ratio
AVGO
68.48
SNPS
52.61
Forward P/E
AVGO
19.65
SNPS
26.22
P/B Ratio
AVGO
20.79
SNPS
2.62
P/S Ratio
AVGO
24.35
SNPS
11.37
EV/EBITDA
AVGO
46.0
SNPS
64.79

Profitability

Gross Margin
AVGO
76.73%
SNPS
81.13%
Operating Margin
AVGO
44.94%
SNPS
9.5%
Profit Margin
AVGO
36.57%
SNPS
31.04%
ROE
AVGO
33.37%
SNPS
6.5%
ROA
AVGO
10.66%
SNPS
2.31%

Growth

Revenue Growth
AVGO
29.5%
SNPS
14.0%
Earnings Growth
AVGO
31.6%
SNPS
-42.7%

Financial Health

Debt/Equity
AVGO
0.83
SNPS
0.55
Current Ratio
AVGO
1.9
SNPS
1.62
Quick Ratio
AVGO
1.67
SNPS
1.4

Dividends

Dividend Yield
AVGO
0.74%
SNPS
--
Payout Ratio
AVGO
47.17%
SNPS
0.0%

AI Verdict

AVGO NEUTRAL

Broadcom exhibits a dichotomy between elite operational performance and poor deterministic value metrics. While the Piotroski F-Score of 4/9 indicates stable health, the stock trades at a massive premium to its Graham Number ($44.08) and Intrinsic Value ($151.04). This valuation gap is partially justified by a very attractive PEG ratio (0.68) and strong forward P/E (19.65), suggesting high growth expectations. However, aggressive insider selling by the CEO and CFO, combined with a bearish technical trend, offsets the strong analyst 'strong_buy' consensus.

Strengths
Exceptional profitability with 76.73% gross margins and 44.94% operating margins
Strong growth trajectory with ~30% YoY increases in both revenue and earnings
Impressive earnings track record with consistent beats over 25 quarters
Risks
Severe overvaluation relative to defensive fair value (Graham Number)
Strong bearish insider sentiment with 14 sell transactions and 0 buys
Technical trend is currently 0/100 (Bearish)
SNPS NEUTRAL

Synopsys (SNPS) trades at a premium valuation with strong gross margins and solid long-term revenue growth, but faces significant near-term headwinds reflected in sharply declining earnings and negative price momentum. Despite a bullish analyst target price of $556.40 implying 43% upside, recent quarters have shown deteriorating profitability, with YoY EPS down 56.3% and a -44.3% earnings surprise in Q3 2025. The company maintains a healthy balance sheet with a Debt/Equity of 0.55 and strong liquidity, yet insider selling worth $29.76M over the past six months raises caution. Relative to peers like SNOW and ADI, SNPS exhibits better margins and cash flow discipline but lags in earnings growth and market sentiment, trading 40% below its 52-week high amid broader semiconductor cyclicality concerns.

Strengths
Exceptional gross margin of 81.13%, reflecting pricing power and low variable costs in software licensing model
Revenue growth of 14.00% YoY outpaces sector average of 19.46% but remains resilient in a high-margin business
Strong liquidity profile with Current Ratio of 1.62 and Quick Ratio of 1.40, indicating robust short-term financial health
Risks
Earnings growth collapsing: YoY EPS down 56.3% and Q/Q EPS down 59.1%, signaling severe profitability compression
High valuation despite earnings decline: Forward P/E of 26.22 appears stretched given negative earnings momentum
Recent insider selling by CFO and CEO totaling $29.76M over 6 months signals leadership's lack of near-term confidence

Compare Another Pair

AVGO vs SNPS: Head-to-Head Comparison

This page compares Broadcom Inc. (AVGO) and Synopsys, Inc. (SNPS) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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