(CDNS) Cadence Design Systems - NASDAQ
Sector: Technology | Industry: Software - Application | Exchange: NASDAQ (USA) | Market Cap: 106.178m USD | Total Return: 30.5% in 12m
Avg Turnover: 966M
EPS Trend: 98.5%
Qual. Beats: 8
Rev. Trend: 98.9%
Qual. Beats: 4
Warnings
P/E ratio 90.2
Fakeout
Tailwinds
Idiosyncratic Leader
Cadence Design Systems, Inc. (CDNS) provides computational software, hardware, and intellectual property (IP) for the semiconductor and electronics industries. The company’s portfolio centers on Electronic Design Automation (EDA), offering tools for functional verification, digital integrated circuit (IC) design, and custom IC simulation. Key platforms include Palladium for enterprise emulation and Virtuoso for analog design, alongside generative AI solutions like Verisium.
The business model relies heavily on a subscription-based software-as-a-service (SaaS) framework, which provides high recurring revenue and deep integration into the research and development cycles of chipmakers. As semiconductor designs move toward smaller process nodes and 3D-IC architectures, the complexity of verification increases, driving demand for Cadences System Design and Analysis (SD&A) tools. The company also maintains a strategic collaboration with NVIDIA to integrate AI-driven efficiencies into the chip design process.
For more detailed insights into the companys fundamentals, you may wish to explore the data available on ValueRay. Cadence operates within a highly consolidated industry where high barriers to entry are maintained through significant R&D investment and specialized technical IP.
- AI-driven EDA software demand accelerates revenue growth from advanced semiconductor design
- Palladium and Protium hardware sales drive high-margin verification systems revenue
- Strategic NVIDIA collaboration strengthens dominant position in generative AI chip development
- Expansion into system analysis and digital twins diversifies beyond core electronic design
- Rising R&D intensity among hyperscalers increases long-term software licensing contract value
| Net Income: 1.17b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.12 > 0.02 and ΔFCF/TA -3.47 > 1.0 |
| NWC/Revenue: 18.41% < 20% (prev 55.34%; Δ -36.92% < -1%) |
| CFO/TA 0.13 > 3% & CFO 1.60b > Net Income 1.17b |
| Net Debt (1.71b) to EBITDA (1.99b): 0.86 < 3 |
| Current Ratio: 1.47 > 1.5 & < 3 |
| Outstanding Shares: last quarter (273.7m) vs 12m ago 0.03% < -2% |
| Gross Margin: 88.85% > 18% (prev 85.86%; Δ 3.00% > 0.5%) |
| Asset Turnover: 52.37% > 50% (prev 54.08%; Δ -1.71% > 0%) |
| Interest Coverage Ratio: 14.45 > 6 (EBIT TTM 1.72b / Interest Expense TTM 119.0m) |
| A: 0.08 (Total Current Assets 3.18b - Total Current Liabilities 2.16b) / Total Assets 12.1b |
| B: 0.61 (Retained Earnings 7.44b / Total Assets 12.1b) |
| C: 0.16 (EBIT TTM 1.72b / Avg Total Assets 10.6b) |
| D: 1.19 (Book Value of Equity 6.56b / Total Liabilities 5.54b) |
| Altman-Z'' = 4.89 = AA |
| DSRI: 1.63 (Receivables 1.07b/580.9m, Revenue 5.53b/4.87b) |
| GMI: 0.97 (GM 85.86% / 88.85%) |
| AQI: 1.37 (AQ_t 0.69 / AQ_t-1 0.50) |
| SGI: 1.13 (Revenue 5.53b / 4.87b) |
| TATA: -0.04 (NI 1.17b - CFO 1.60b) / TA 12.1b) |
| Beneish M = -2.23 (Cap -4..+1) = BBB |
As of June 19, 2026, the stock is trading at USD 387.39 with a total of 7,074,255 shares traded.
Over the past week, the price has changed by +0.95%,
over one month by +11.97%,
over three months by +33.75% and
over the past year by +30.50%.
Cadence Design Systems has received a consensus analysts rating of 4.56. Therefore, it is recommended to buy CDNS.
- StrongBuy: 17
- Buy: 5
- Hold: 3
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 385.4 | -0.5% |
P/E Trailing = 90.1546
P/E Forward = 48.5437
P/S = 19.2052
P/B = 16.1821
P/EG = 3.6546
Revenue TTM = 5.53b USD
EBIT TTM = 1.72b USD
EBITDA TTM = 1.99b USD
Long Term Debt = 2.48b USD (from longTermDebt, last quarter)
Short Term Debt = 425.0m USD (from shortTermDebt, last quarter)
Debt = 3.26b USD (from shortLongTermDebtTotal, last quarter) + Leases 177.2m
Net Debt = 1.71b USD (calculated: Debt 3.26b - CCE 1.55b)
Enterprise Value = 108b USD (106b + Debt 3.26b - CCE 1.55b)
Interest Coverage Ratio = 14.45 (Ebit TTM 1.72b / Interest Expense TTM 119.0m)
EV/FCF = 75.45x (Enterprise Value 108b / FCF TTM 1.43b)
FCF Yield = 1.33% (FCF TTM 1.43b / Enterprise Value 108b)
FCF Margin = 25.86% (FCF TTM 1.43b / Revenue TTM 5.53b)
Net Margin = 21.18% (Net Income TTM 1.17b / Revenue TTM 5.53b)
Gross Margin = 88.85% ((Revenue TTM 5.53b - Cost of Revenue TTM 616.3m) / Revenue TTM)
Gross Margin QoQ = none% (prev 86.90%)
Tobins Q-Ratio = 8.92 (Enterprise Value 108b / Total Assets 12.1b)
Interest Expense / Debt = 3.65% (Interest Expense 119.0m / Debt 3.26b)
Taxrate = 26.56% (423.5m / 1.59b)
NOPAT = 1.26b (EBIT 1.72b * (1 - 26.56%))
Current Ratio = 1.47 (Total Current Assets 3.18b / Total Current Liabilities 2.16b)
Debt / Equity = 0.50 (Debt 3.26b / totalStockholderEquity, last quarter 6.56b)
Debt / EBITDA = 0.86 (Net Debt 1.71b / EBITDA 1.99b)
Debt / FCF = 1.20 (Net Debt 1.71b / FCF TTM 1.43b)
Total Stockholder Equity = 5.56b (last 4 quarters mean from totalStockholderEquity)
RoA = 11.09% (Net Income 1.17b / Total Assets 12.1b)
RoE = 21.06% (Net Income TTM 1.17b / Total Stockholder Equity 5.56b)
RoCE = 21.39% (EBIT 1.72b / Capital Employed (Equity 5.56b + L.T.Debt 2.48b))
RoIC = 12.52% (NOPAT 1.26b / Invested Capital 10.1b)
WACC = 10.89% (E(106b)/V(109b) * Re(11.14%) + D(3.26b)/V(109b) * Rd(3.65%) * (1-Tc(0.27)))
Discount Rate = 11.14% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: 15.56 | Cagr: 0.21%
[DCF] Terminal Value 67.68% ; FCFF base≈1.41b ; Y1≈1.46b ; Y5≈1.64b
[DCF] Fair Price = 57.95 (EV 17.7b - Net Debt 1.71b = Equity 16.0b / Shares 275.8m; r=10.89% [WACC]; 5y FCF grow 3.74% → 2.50% )
EPS Correlation: 98.52 | EPS CAGR: 21.12% | SUE: 1.30 | # QB: 8
Revenue Correlation: 98.89 | Revenue CAGR: 15.29% | SUE: 1.71 | # QB: 4
EPS current Quarter (2026-06-30): EPS=2.05 | Chg30d=+0.00% | Revisions=+67% | Analysts=19
EPS next Quarter (2026-09-30): EPS=1.94 | Chg30d=+0.00% | Revisions=-33% | Analysts=18
EPS current Year (2026-12-31): EPS=4.49 | Chg30d=-0.04% | Revisions=-50% | GrowthEPS=+10.7% | GrowthRev=+17.1%
EPS next Year (2027-12-31): EPS=9.38 | Chg30d=+0.05% | Revisions=+53% | GrowthEPS=+18.0% | GrowthRev=+13.1%
[Analyst] Revisions Ratio: +67%