Exploring CADENCE DESIGN SYS INC (NASDAQ:CDNS)s quality characteristics.

Quality investors are looking for the best of the best. Companies which are growing steadily and consistently, but are also in excellent financial condition. We will have a look here to see if CADENCE DESIGN SYS INC (NASDAQ:CDNS) is suited for quality investing. Investors should of course do their own research, but we spotted CADENCE DESIGN SYS INC showing up in our Caviar Cruise quality screen, so it may be worth spending some more time on it.

A Deep Dive into CADENCE DESIGN SYS INC's Quality Metrics.

• CADENCE DESIGN SYS INC has demonstrated significant revenue growth over the past 5 years, with a 13.85% increase. This underscores the company's ability to adapt to market dynamics and capitalize on growth opportunities.
• CADENCE DESIGN SYS INC demonstrates impressive performance in terms of ROIC excluding cash and goodwill, with a 96.04% ratio. This highlights the company's efficient utilization of capital and its focus on maximizing returns for investors.
• CADENCE DESIGN SYS INC demonstrates a well-balanced Debt/Free Cash Flow Ratio of 0.52, indicating effective debt management and strong cash flow generation. This ratio suggests the company has a sustainable financial position and the capacity to allocate capital efficiently.
• With a robust Profit Quality (5-year) ratio of 121.0%, CADENCE DESIGN SYS INC highlights its ability to consistently generate high-quality profits. This metric reflects the company's effective management and operational excellence in delivering reliable earnings over the long term.
• CADENCE DESIGN SYS INC has demonstrated consistent growth in EBIT over the past 5 years, with a strong 25.38%. This signifies the company's ability to generate sustainable earnings and reflects its positive financial trajectory.
• CADENCE DESIGN SYS INC has achieved impressive EBIT 5-year growth, surpassing its Revenue 5-year growth. This indicates the company's ability to improve its profitability and operational efficiency, highlighting its strong financial performance.

Fundamental analysis of NASDAQ:CDNS

ChartMill assigns a proprietary Fundamental Rating to each stock. The score is computed daily by evaluating various fundamental indicators and properties. The score ranges from 0 to 10.

We assign a fundamental rating of 7 out of 10 to CDNS. CDNS was compared to 277 industry peers in the Software industry. Both the health and profitability get an excellent rating, making CDNS a very profitable company, without any liquidiy or solvency issues. CDNS is valued quite expensive, but it does show an excellent growth. These ratings could make CDNS a good candidate for growth and quality investing.

Our latest full fundamental report of CDNS contains the most current fundamental analsysis.

More ideas for quality investing can be found on ChartMill in our Caviar Cruise screen.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.