Synopsys vs Motorola Solutions

This page compares Synopsys and Motorola Solutions, examining business models, financial performance, and market context in a neutral, accessible manner. Educational content, not financial advice.

Comparison Snapshot

Key Financial Metrics

SNPS

Metric

MSI

$87.60B

Market Cap

$67.23B

34.15%

Potential Profit

19.16%

Buy

Analyst Rating

Buy

Why It's Moving

Synopsys stock dips amid market gains as investors eye upcoming Q1 earnings and steady institutional buying.

Principal Financial Group increased its Synopsys holdings by 57.7% in Q3, signaling sustained institutional confidence in the semiconductor design leader.
Upcoming Q1 earnings on Feb. 25 carry expectations of $3.56 EPS (up 17.49% YoY) and $2.39B revenue (up 64.28% YoY), building on prior record results.
Short interest rose slightly to 2.39% of float but remains below peer average of 4.49%, indicating relatively muted bearish sentiment.

Sentiment:

⚖️Neutral

Synopsys stock dips amid market gains as investors eye upcoming Q1 earnings and steady institutional buying.

Principal Financial Group increased its Synopsys holdings by 57.7% in Q3, signaling sustained institutional confidence in the semiconductor design leader.
Upcoming Q1 earnings on Feb. 25 carry expectations of $3.56 EPS (up 17.49% YoY) and $2.39B revenue (up 64.28% YoY), building on prior record results.
Short interest rose slightly to 2.39% of float but remains below peer average of 4.49%, indicating relatively muted bearish sentiment.

Sentiment:

⚖️Neutral

Investment Analysis

Synopsys

SNPS

Pros

Synopsys holds a dominant duopoly position in the electronic design automation (EDA) market with near-100% customer retention, supported by a high proportion of recurring subscription revenue.
The company operates the largest intellectual property licensing business in the industry, embedding its pre-designed digital and analog components deeply into the semiconductor design ecosystem.
Synopsys has strong financials with a gross margin over 81% and a solid net profit margin above 18%, reflecting efficient operations and profitability.

Considerations

U.S.-China trade tensions and export restrictions have materially impacted Synopsys' China business, causing recent earnings misses and resulting in lowered financial guidance.
The integration of the large Ansys acquisition presents substantial execution risks and short-term margin pressure due to increased costs and required divestitures in 2025.
Synopsys faces constant competitive pressure from Cadence Design Systems, which often achieves higher operating margins and leverages AI innovations aggressively, requiring Synopsys to continually defend market share.

Motorola Solutions

MSI

Pros

Motorola Solutions benefits from a diversified portfolio offering public safety and enterprise security products and software, with strong presence in the U.S., U.K., Canada, and internationally.
The company has robust profitability metrics, including a normalized return on equity exceeding 200% and a return on invested capital above 33%, indicating efficient capital use and strong earnings generation.
Motorola Solutions maintains consistent revenue growth with a trailing twelve months (TTM) revenue of over $11 billion and solid net income of $2.12 billion, underpinned by a stable customer base in critical infrastructure sectors.

Considerations

The company’s relatively high price-to-earnings ratio near 32 may indicate rich valuation compared to its historical averages, which could limit upside potential if growth slows.
Motorola Solutions operates in highly regulated government and public safety markets, exposing it to regulatory and political risks that may affect contract awards and pricing.
The business faces competitive technology innovation risks, requiring ongoing investments in software and systems integration to maintain leadership against rivals in fast-evolving communication equipment sectors.

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