Synopsys Upgraded at Piper Sandler on Intel Foundry, Apple

Piper Sandler upgraded Synopsys (NASDAQ: SNPS), a semiconductor design software maker, to Overweight from Neutral and raised its price target to $550 from $450. The upgrade is based on improving prospects for the company's intellectual property (IP) business as Intel's foundry ambitions gain traction and an Apple opportunity emerges.

Rating Change

• Previous Rating: Neutral
• New Rating: Overweight
• New Price Target: $550
• Previous Price Target: $450

Analyst Rationale

Piper Sandler analysts believe Synopsys' IP business will benefit from Intel's progress in contract manufacturing (foundry), as the demand for complex IP blocks increases. Additionally, the opportunity to work with Apple is seen as a catalyst, given Apple's reliance on custom chip designs.

Context

The upgrade comes amid a shift in the semiconductor industry toward advanced manufacturing, with Intel seeking to regain leadership through its foundry services. No other analysts have issued similar comments yet, but Synopsys shares are trading slightly higher following the news.

What to Make of It

The upgrade reflects Piper Sandler's optimism about Synopsys' growth potential in the IP segment, especially as Intel expands its foundry operations. However, the outcome depends on Intel executing its plans and delivering tangible results.