Synopsys, Inc. (SNPS) vs Block, Inc. (XYZ)

Synopsys, Inc. and Block, Inc. are both Software Infrastructure companies. Synopsys, Inc. is the larger, with a market value of $81.4B against $46.1B — 1.8× the size. Synopsys, Inc. trades at the lower P/E: 74.7× against 132×. Synopsys, Inc. grew revenue faster over the last twelve months: 46.3% against 5.07%. Synopsys, Inc. has the higher net margin (11.4% vs 1.43%) and the lower return on invested capital (1.33% vs 3.43%). Across the 22 metrics below, Synopsys, Inc. leads on 11 and Block, Inc. on 11.

Valuation

Metric SNPS XYZ Software Infrastructure median
P/E 74.69 131.76 28.02
P/S 8.66 1.82 3.07
P/B 2.62 2.08 3.36
Price to free cash flow 29.68 11.77 17.12
EV/EBITDA 32.26 130.77 14.91
EV/Sales 9.34 1.86 3.03
Earnings yield 1.34% 0.76% 0.13%
Free cash flow yield 3.37% 8.49% 1.15%

Profitability

Metric SNPS XYZ Software Infrastructure median
Gross margin 72.38% 46.36% 61.23%
Operating margin 8.52% 4.67% 0.00%
Net margin 11.43% 1.43% 0.00%
Free cash flow margin 29.18% 15.50% 1.67%
Return on equity 3.66% 1.62% 0.59%
Return on assets 2.24% 0.94% 0.00%
Return on invested capital 1.33% 3.43% 0.00%

Growth

Metric SNPS XYZ Software Infrastructure median
Revenue growth (TTM) 46.33% 5.07% 13.41%
EPS growth (last fiscal year) (44.59%) (53.95%) —
Revenue growth, 5-year CAGR 13.87% 20.56% 15.81%
Net income growth, 5-year CAGR 14.93% 43.70% 0.00%

Health

Metric SNPS XYZ Software Infrastructure median
Debt to equity 0.32 0.26 0.06
Current ratio 1.34 2.21 1.55
Net debt to EBITDA 6.25 0.22 0.08

Dividend

Metric SNPS XYZ Software Infrastructure median
Dividend yield — — 1.53%
Payout ratio 0.00 0.00 0.00

Size

Metric SNPS XYZ Software Infrastructure median
Market cap 81.44b 46.11b 835.96m

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