CADENCE DESIGN SYS INC (NASDAQ:CDNS) Exhibits Quality Stock Traits. Here's Why.

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.

Highlighting Notable Quality Metrics of CDNS.

• Over the past 5 years, CDNS has experienced impressive revenue growth, with 14.72% increase. This demonstrates the company's ability to effectively expand its top line and suggests a positive outlook for future revenue generation.
• CDNS demonstrates impressive performance in terms of ROIC excluding cash and goodwill, with a 59.0% ratio. This highlights the company's efficient utilization of capital and its focus on maximizing returns for investors.
• With a Debt/Free Cash Flow Ratio of 2.21, CDNS exhibits solid financial health and responsible debt management practices. This ratio indicates the company's ability to generate ample free cash flow to meet its debt obligations and pursue growth opportunities.
• CDNS demonstrates consistent Profit Quality over the past 5 years, with a strong 129.0%. This indicates the company's ability to generate sustainable and reliable profits, showcasing its long-term profitability and financial stability.
• CDNS has experienced impressive EBIT growth over the past 5 years, with 22.65% increase. This reflects the company's effective operational performance and highlights its potential for long-term financial success.
• CDNS 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 CDNS

At ChartMill, a crucial aspect of their analysis is the assignment of a Fundamental Rating to each stock. This rating, ranging from 0 to 10, is calculated daily by considering numerous fundamental indicators and properties.

CDNS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 285 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 expensively, but it does show have an excellent growth rating. This makes CDNS very considerable for growth and quality investing!

Check the latest full fundamental report of CDNS for a complete fundamental analysis.

More quality stocks can be found in our Caviar Cruise screen.

Keep in mind

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.