Loop starts Synopsys at Buy, sees ingredients for consistent revenue growth

Loop Capital initiated coverage of Synopsys (SNPS) with a Buy rating and $675 price target The firm sees increasing captive chip designs coming from system original equipment manufacturers and hyperscalers, and China’s chip design activity is outpacing RoW as China attempts to foster a domestic chip industry, the analyst tells investors in a research note. The firm said that this fragmentation in chip design activity presents a long-term secular challenge for traditional merchant semiconductor companies, and investment in companies like Synopsys is an ideal way to hedge against this trend.