Synopsys, Inc. provides electronic design automation software products used to design and test integrated circuits. The company offers Fusion Design Platform that provides digital design implementation solutions; Verification Continuum Platform that provides virtual prototyping, static and formal verification, simulation, emulation, field programmable gate array (FPGA)-based prototyping, and debug solutions; and FPGA design products that are programmed to perform specific functions. It also provides intellectual property (IP) solutions for USB, PCI Express, DDR, Ethernet, SATA, MIPI, HDMI, and Bluetooth low energy applications; analog IP, including data converters and audio codecs; and system-on-chip (SoC) infrastructure IP, datapath and building block IP, and verification IP products, as well as mathematical and floating-point components, and Arm AMBA interconnect fabric and peripherals. In addition, the company offers logic libraries and embedded memories; configurable processor cores and application-specific instruction-set processor tools for embedded applications; IP subsystems for audio, sensor, and data fusion functionality; and security IP solutions. Further, it provides Platform Architect solutions for SoC architecture analysis and optimization; virtual prototyping solutions; and HAPS FPGA-based prototyping systems, as well as a series of tools used in the design of optical systems and photonic devices. Additionally, the company offers security testing, managed services, programs and professional services, and training that enable its customers to detect and remediate security vulnerabilities, and defects in the software development lifecycle, as well as manufacturing solutions. It serves electronics, financial services, automotive, medicine, energy, and industrial areas. The company was incorporated in 1986 and is headquartered in Mountain View, California.

BUILD UP FREE CASH	2022-10-31 (A)	2023-10-31 (A)	2024-10-31 (A)	2025-10-31 (E)	2026-10-31 (E)	2027-10-31 (E)	2028-10-31 (E)	2029-10-31 (E)
Revenue	4,615.7	5,318	6,127.4	7,043.8	9,634.6	10,648	10,648	10,648
Revenue % Chg.	9.8%	15.2%	15.2%
EBIT	1,159.9	1,326.3	1,355.7	2,613.5	3,793.1	4,386.4	4,386.4	4,386.4
EBIT Margin	25.1%	24.9%	22.1%
Tax Rate	12.6%	6.9%	6.6%
NOPAT	1,013.4	1,234.7	1,266.4	2,195.3	3,189.7	3,690.1	3,690.1	3,690.1
NOPAT Margin	22%	23.2%	20.7%	31.2%	33.1%	34.7%	34.7%	34.7%
D&A	183.2	199.5	190.3	492.1	1,247.4	1,368	1,368	1,368
D&A / Revenue	4%	3.8%	3.1%
Capex	-136.6	-189.6	-123.2	-184.2	-220.4	-247.1	-247.1	-247.1
Capex / Revenue	-3%	-3.6%	-2%
Chg. NWC	-59.3	-327.3	-707.6	-445.8	-609.8	-674	-674	-674
Chg. NWC / Revenue	-1.3%	-6.2%	-11.5%
Unlevered FCF (UFCF)	1,000.6	917.2	625.9	2,057.4	3,606.8	4,137	4,137	4,137
UFCF % Chg.	9.8%	-8.3%	-31.8%	228.7%	75.3%	14.7%	—	—
PV of UFCF	—	—	—	1,894	3,056.5	3,227.3	2,971	2,734.9
Sum of PV of UFCF	—	—	—	1,894	4,950.5	8,177.9	11,148.8	13,883.8

Cost of Debt
Tax Rate
After Tax Cost of Debt	4.7%
Risk Free Rate
Market Risk Premium
Beta	1
Cost of Equity	8.7%
Total Debt	684.5
Market Cap	88,375.1
Total Capital	89,059.6
Debt Weighting	0.8%
Equity Weighting	99.2%
WACC	8.6%

Exit Multiple EV/FCF
Terminal Value	100,921.4
PV of Terminal Value	61,417.5
Cumulative PV of UFCF	13,883.8
Net Debt	12,546.6
Equity Value	62,754.7
Shares Outstanding	190.6
Implied Share Price	329.3
Current Share Price	463.7
Implied Upside / (Downside)	-29%