Synopsys

Management has historically deployed capital judiciously. Synopsys continually plows a large portion of cash into R&D to fuel future moat-building, which aligns well with its high return profile.

In 2022 it authorized a $1.5B share-buyback; by FY2024 it had repurchased $1.2B of shares, though the program was paused to preserve cash for the Ansys transaction. The company has no dividend, preferring buybacks and investment.

Stock-based comp dilution is moderate: shares outstanding have risen mainly via management issuances and the Ansys merger exchange, but previously repurchases partially offset this. Acquisitions are approached carefully – Synopsys makes few large deals, preferring tuck-in tech buys, except for strategic moves like the game-changing Ansys deal.

That acquisition (and the spin-off of Software Integrity in 2024) demonstrates good capital discipline and focus. Overall, the board seems shareholder-friendly; capital allocation is efficient for a tech enterprise.