Shares of Synopsys (SNPS), a leading provider of electronic design automation software, soared 11.19% in pre-market trading on Thursday. This significant uptick comes on the heels of news that Nvidia plans to invest $5 billion in Intel, signaling a major boost for the semiconductor industry.

The announcement of Nvidia's substantial investment in Intel has sent ripples through the tech sector, particularly benefiting companies closely tied to chip design and manufacturing. Synopsys, with its crucial role in developing software for designing and testing integrated circuits, stands to gain from this increased activity and investment in the semiconductor space.

This pre-market surge aligns with recent analyst views on Synopsys' potential. Prior to this movement, the company was already considered undervalued by some metrics, with its stock trading at $425.4 compared to an estimated fair value of $492.37. The company has also been forecasting significant earnings growth over the next three years, outpacing the broader US market despite some profitability challenges in the short term.

As the semiconductor industry continues to evolve with increasing demand for advanced chip technologies, Synopsys' position as a key player in electronic design automation could further strengthen. Investors will be watching closely to see if this pre-market momentum carries through the regular trading session and whether it marks the beginning of a broader rally in the semiconductor sector.