Griffin on Technical Software: Initiates Coverage on Electronic Design Automation (EDA) Industry
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Up: 8 | Down: 5 | New: 26
Rating Summary:
28 Buy, 6 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Griffin on Technical Software: Initiates Coverage on Electronic Design Automation (EDA) Industry
"We are initiating coverage of the Electronic Design Automation (EDA) industry, with coverage of the three principal software and services suppliers: Cadence Design Systems Inc. (Nasdaq: CDNS), Mentor Graphics Corp. (Nasdaq: MENT), and Synopsys Inc. (Nasdaq: SNPS)...We are initiating CDNS with a Neutral rating, MENT with a Neutral rating, and SNPS with a Buy rating and $33 price target."
"With a current enterprise value of about $2.645 billion, Cadence shares are trading at about 2.4x our estimated 2011 revenues and about 2.3x our estimated 2012 revenues. In addition, the shares are trading at 24.2x our estimate for 2011 non-GAAP earnings and 16.7x our estimate for 2012 non-GAAP earnings. Based on our current cash flow forecasts, the free cash flow yield is about 5.9%. With an enterprise value of about $1.60 billion, Mentor shares are currently trading at 1.6x our estimated FY12 (ending January 2012) revenues and just under 1.6x our estimated FY13 revenues (within its historical range of the past decade or more of about 1x-2x). In addition, the shares are trading at 12.9x our estimate for FY12 non-GAAP earnings and 11.1x our estimate for FY13 non-GAAP earnings. The free cash flow yield is about 5.5%. With an enterprise value of about $3.275 billion, Synopsys shares are currently trading at about 2.2x our estimated FY11 (ending October 2011) revenues and about 2.0x our estimated FY12 revenues. In addition, the shares are trading at 15.7x our estimate for FY11 non-GAAP earnings and 13.9x our estimate for FY12 non-GAAP earnings. The free cash flow yield is about 6.8%."
"We are initiating coverage of the Electronic Design Automation (EDA) industry, with coverage of the three principal software and services suppliers: Cadence Design Systems Inc. (Nasdaq: CDNS), Mentor Graphics Corp. (Nasdaq: MENT), and Synopsys Inc. (Nasdaq: SNPS)...We are initiating CDNS with a Neutral rating, MENT with a Neutral rating, and SNPS with a Buy rating and $33 price target."
"With a current enterprise value of about $2.645 billion, Cadence shares are trading at about 2.4x our estimated 2011 revenues and about 2.3x our estimated 2012 revenues. In addition, the shares are trading at 24.2x our estimate for 2011 non-GAAP earnings and 16.7x our estimate for 2012 non-GAAP earnings. Based on our current cash flow forecasts, the free cash flow yield is about 5.9%. With an enterprise value of about $1.60 billion, Mentor shares are currently trading at 1.6x our estimated FY12 (ending January 2012) revenues and just under 1.6x our estimated FY13 revenues (within its historical range of the past decade or more of about 1x-2x). In addition, the shares are trading at 12.9x our estimate for FY12 non-GAAP earnings and 11.1x our estimate for FY13 non-GAAP earnings. The free cash flow yield is about 5.5%. With an enterprise value of about $3.275 billion, Synopsys shares are currently trading at about 2.2x our estimated FY11 (ending October 2011) revenues and about 2.0x our estimated FY12 revenues. In addition, the shares are trading at 15.7x our estimate for FY11 non-GAAP earnings and 13.9x our estimate for FY12 non-GAAP earnings. The free cash flow yield is about 6.8%."
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