Chip design software maker Synopsys has gotten a boost from investor enthusiasm for artificial intelligence technology. SNPS stock is in a buy zone after the company announced new AI-based chip design tools.
At its annual users conference on Wednesday, Synopsys launched a suite of AI-driven solutions for the design, verification, testing and manufacturing of the most advanced digital and analog chips. The suite of products is called Synopsys.ai.
Synopsys described the new software as the industry's first full-stack, AI-driven set of electronic design automation, or EDA, tools. It named Nvidia, TSMC, IBM, MediaTek and Renesas as early users of Synopsys.ai.
The new tools can significantly boost engineering productivity and semiconductor quality while minimizing costs, Synopsys said.
"Increased complexity, engineering resource constraints and tighter delivery windows were challenges crying out for a full AI-driven EDA software stack from architectural exploration to design and manufacturing — and we've delivered it," Shankar Krishnamoorthy, general manager of Synopsys EDA Group, said in a news release.
SNPS Stock Rises After AI Announcement
On the stock market today, SNPS stock climbed 2.7% to close at 386.25. It has advanced in the last three trading sessions.
On Feb. 1, Synopsys stock broke out of a cup-with-handle base at a buy point of 364.09, according to IBD MarketSmith daily charts. Since then, it has traded in and out of the 5% buy zone of the breakout.
The buy zone runs from 364.09 to 382.29, based on IBD trading guidelines.
Additionally, on a weekly chart, SNPS stock broke out of a flat base at a buy point of 379.86 on March 22. The buy zone for that breakout runs from 379.86 to 398.85.
Further, Synopsys stock is on the IBD Tech Leaders list and in the IBD Long-Term Leaders Portfolio.
Artificial Intelligence Craze Boosting Stocks
SNPS stock isn't the only one getting a lift from the AI investing craze. Other tech stocks rising on AI product news include Adobe, Intel, Microsoft and Nvidia.
On March 21, Nvidia announced that it is working with Synopsys, chip gear vendor ASML and chip foundry TSMC to use AI to accelerate semiconductor breakthroughs. Nvidia introduced its cuLitho software library for computational lithography to design chips with smaller integrated circuits.
Synopsys ranks fifth out of 12 stocks in IBD's Computer Software-Design industry group, according to IBD Stock Checkup. SNPS stock has an IBD Composite Rating of 94 out of 99.
IBD's Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock's strengths. The best growth stocks have a Composite Rating of 90 or better.
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