Synopsys (NASDAQ:SNPS) and SS&C Technologies (NASDAQ:SSNC) Critical Survey

Synopsys (NASDAQ:SNPS) and SS&C Technologies (NASDAQ:SSNC) are both large-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, valuation, dividends, institutional ownership, profitability and risk.

Profitability

This table compares Synopsys and SS&C Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Synopsys	13.76%	6.83%	3.93%
SS&C Technologies	12.65%	20.09%	7.11%

Analyst Recommendations

This is a summary of recent ratings and price targets for Synopsys and SS&C Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Synopsys	1	8	8	0	2.41
SS&C Technologies	0	3	5	1	2.78

Synopsys presently has a consensus price target of $531.00, suggesting a potential upside of 10.34%. SS&C Technologies has a consensus price target of $96.13, suggesting a potential upside of 38.33%. Given SS&C Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe SS&C Technologies is more favorable than Synopsys.

Volatility and Risk

Synopsys has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, SS&C Technologies has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500.

Institutional and Insider Ownership

85.5% of Synopsys shares are held by institutional investors. Comparatively, 96.9% of SS&C Technologies shares are held by institutional investors. 0.6% of Synopsys shares are held by insiders. Comparatively, 16.0% of SS&C Technologies shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Synopsys and SS&C Technologies”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Synopsys	$7.05 billion	13.07	$1.33 billion	$6.44	74.72
SS&C Technologies	$6.41 billion	2.61	$796.90 million	$3.23	21.51

Synopsys has higher revenue and earnings than SS&C Technologies. SS&C Technologies is trading at a lower price-to-earnings ratio than Synopsys, indicating that it is currently the more affordable of the two stocks.

Summary

SS&C Technologies beats Synopsys on 8 of the 15 factors compared between the two stocks.

About Synopsys

Synopsys, Inc. provides electronic design automation software products used to design and test integrated circuits. It operates in three segments: Design Automation, Design IP, and Software Integrity. The company offers Digital and Custom IC Design solution that provides digital design implementation solutions; Verification solution that offers 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, MIPI, HDMI, and Bluetooth low energy applications; logic libraries and embedded memories; processor cores, software, and application-specific instruction-set processor tools for embedded applications; security IP solutions; IP solutions for automotive market; 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 HAPS FPGA-based prototyping systems; virtual prototyping solutions; and Platform Architect solutions for SoC architecture analysis and optimization, as well as optical products, and mechatronic simulations. Further, it provides security and quality testing products, 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. Additionally, the company provides intelligent orchestration solution, software risk manager, and black duck software composition analysis tools. It serves electronics, financial services, automotive, medicine, energy, and industrial areas. The company was incorporated in 1986 and is headquartered in Sunnyvale, California.

About SS&C Technologies

SS&C Technologies Holdings, Inc. engages in the development and provision of software solutions to the financial services and healthcare industries. It operates through the following geographical segments: United States, Europe, Middle East and Africa, Asia Pacific and Japan, Canada, and the Americas, excluding the United States and Canada. Its products include advent genesis, antares, asset allocators, AWD, axys, BANC mall, BRIX, DST vision, evare, lightning, and moxy. The company was founded by William Charles Stone in March 1986 and is headquartered in Windsor, CT.