Deutsche Bank Just Upped Its Price Target on Synopsys Stock. Here's Why.

Synopsys (SNPS) shares are attractive as a long-term holding after the company announced multi-year agreements with Amazon (AMZN) and OpenAI, says Gianmarco P. Conti, a Deutsche Bank analyst. Conti maintained a “Buy” rating on SNPS this morning and raised his price target to $640, indicating potential upside of more than 45% from current levels. 

His bullish call is particularly significant as Synopsys stock has already been in a major uptrend, currently trading more than 30% above its September low. 

Why Deutsche Bank Raised Its Price Target on Synopsys Stock

Synopsys values its Amazon contract at more than $1 billion, excluding royalties built into the deal structure.

Together with the OpenAI partnership, the company is now positioned for “higher segment growth floors, faster Ansys revenue synergy ramp, and a steeper operating-margin trajectory,” Conti told clients in his research note. 

The analyst now expects Synopsys’s fiscal 2030 revenue to come in at $15.87 billion, up from his previous estimate of $15.15 billion. 

Even from a technical perspective, the chip-design software firm is trading firmly above its major moving averages (MAs), with an RSI in the early 70s indicating intense buying pressure. 

Bullish Guidance Also Makes SNPS Shares Worth Buying

Deutsche Bank recommends owning SNPS stock also because management issued a bullish outlook for fiscal 2027 today. 

The company now sees revenue soaring 15% on a year-over-year basis to $11.15 billion, with the adjusted operating margin seen coming in at a remarkable 44%. 

Importantly, the investment firm believes Synopsys could diversify its growth beyond software licenses over time to usage-based fees, customized products, and royalties. 

Value-conscious investors must also note that the Nasdaq-listed firm is currently trading at a forward price-to-earnings (P/E) ratio of about 38x, which makes it more attractive as a long-term holding than peer Cadence Design Systems at nearly 51x. 

Wall Street Remains Constructive on Synopsys

Crucially, Deutsche Bank is not the only Wall Street firm recommending owning Synopsys shares for the remainder of 2026. 

The consensus rating on SNPS sits at “Strong Buy” currently, with the mean price target of roughly $562 indicating potential for a significant rally from here. 

On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.