BofA $375 & $515 Targets Cadence, Synopsys

Bank of America recommends Cadence Design Systems with a $375 price target, based on 40x 2027 earnings estimate.
BofA also assigns Synopsys a $515 price objective, using a 29x multiple of its projected 2027 earnings.
The bank cites rising chip complexity driving EDA demand, while noting valuation compression in software sector and potential economic downturn risks.
It highlights upside from government semiconductor R&D spending, M&A margin expansion, and cost improvements, but warns of IP sales volatility and competition.