Bank of America Calls Synopsys (SNPS) a Lower-Beta AI Play With Catch-Up Potential

Synopsys, Inc. (NASDAQ:SNPS) is one of the AI Stocks in the Spotlight for InvestorsOn December 11, Bank of America upgraded the stock to “Buy” from neutral and raised its price target to $560.00 from $500.00. The bank said that following latest results, shares of Synopsys are attractive at current levels.

“We believe the relative derisking of China and Intel sales along with strong growth at Ansys clears the decks for Synopsys to provide attractive stock catch-up potential and EPS beats for the next year.”

According to analysts led by Vivek Arya, the company’s non-GAAP EPS guidance for the full fiscal year 2026, at $14.36 midpoint, is well ahead of consensus ($14.11). The team raised its fiscal year 2026/2027 non-GAAP EPS estimates to $ 14.37 and $17, respectively.

“While the stock could consolidate at current-levels after the ~20% recent run, we believe it provides an attractive lower-beta, AI-levered/adjacent candidate with recurring sales tied to more resilient chip design R & D spending.”

Synopsys, Inc. (NASDAQ:SNPS) is a technology company that provides software and services for silicon-to-systems design, including electronic design automation (EDA) tools, silicon IP, and system verification and validation.

While we acknowledge the risk and potential of SNPS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SNPS and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 12 Must-Watch AI Stocks on Wall Street and 11 AI Stocks Analysts Are Watching Closely.

Disclosure: None.