Synaptics (SYNA): Assessing Valuation After Astra AI Processor Reveal for IBC 2025

If you have been keeping an eye on Synaptics (SYNA), the latest announcement may pique your interest. Synaptics is preparing for a high-profile showcase at IBC 2025, where it will be spotlighting its Astra line of AI-native processors. The company plans to demonstrate features ranging from voice biometrics and SDR to HDR video conversion, as well as smarter audio and video analytics, all aimed at delivering richer user experiences in set-top boxes and streaming devices. For investors, this not only highlights Synaptics' big bet on AI-driven consumer electronics but also raises questions about what these developments could mean for the stock. Looking at the broader picture, Synaptics’ stock has struggled in the longer run, posting a 5.6% drop over the past year and a larger decline when viewed over three and five years. However, there has been a flicker of momentum lately, with shares climbing over 14% in the past three months. This suggests shifting sentiment as Synaptics pushes new technology to market, even as its year-to-date return is still negative. With that in mind, do these innovations mark a turning point for Synaptics, or is the market already factoring in everything these advancements might yield? Is there a genuine buying opportunity here, or is Wall Street just keeping pace?

Most Popular Narrative: 14% Undervalued

According to the most widely followed narrative, Synaptics is trading meaningfully below its estimated fair value. The consensus is that the market may be overlooking key forward drivers.

The company's strategy to bundle highly integrated solutions combining wireless connectivity, low-power mixed-signal processing, and embedded AI/software content is expected to increase silicon content per device and drive higher gross margins as more revenue is captured per customer design win.

Want to know what’s fueling this predicted upside? The fair value hinges on bold assumptions about turnarounds in growth and margins that could surprise even seasoned investors. What if Synaptics achieved profitability levels once reserved for the industry’s elite? Curious about which numbers truly set this story apart? The full narrative breaks down the exact projections driving this “undervalued” thesis.

Result: Fair Value of $82.25 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, challenges such as ramping up new sales channels and maintaining pricing power in a competitive landscape could undermine Synaptics’ projected turnaround.

Find out about the key risks to this Synaptics narrative.

Another View: DCF Model Perspective

While many focus on Synaptics' valuation by comparing it to industry pricing, our DCF model takes a different approach. This model currently signals that the shares are trading below their fair value. Could this model be overlooking key industry challenges, or is it revealing a hidden opportunity?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Synaptics for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Synaptics Narrative

If you see the story unfolding differently or want to examine the data yourself, you can craft your own perspective in just a few minutes. Do it your way

A great starting point for your Synaptics research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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