317.76 USD
+0.83 (+0.26%)
317.76 USD
0 (0%)
CDNS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 278 industry peers in the Software industry. While CDNS has a great profitability rating, there are some minor concerns on its financial health. CDNS shows excellent growth, but is valued quite expensive already. With these ratings, CDNS could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
CDNS had positive earnings in the past year.
CDNS had a positive operating cash flow in the past year.
CDNS had positive earnings in each of the past 5 years.
In the past 5 years CDNS always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 11.05%, CDNS belongs to the best of the industry, outperforming 87.05% of the companies in the same industry.
Looking at the Return On Equity, with a value of 20.41%, CDNS belongs to the top of the industry, outperforming 88.49% of the companies in the same industry.
CDNS has a Return On Invested Capital of 15.75%. This is amongst the best in the industry. CDNS outperforms 92.81% of its industry peers.
CDNS had an Average Return On Invested Capital over the past 3 years of 20.16%. This is significantly above the industry average of 10.78%.
The 3 year average ROIC (20.16%) for CDNS is well above the current ROIC(15.75%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.05% | ||
| ROE | 20.41% | ||
| ROIC | 15.75% |
ROA(3y)15.55%
ROA(5y)15.49%
ROE(3y)28.03%
ROE(5y)26.64%
ROIC(3y)20.16%
ROIC(5y)18.92%
1.3 Margins
With an excellent Profit Margin value of 20.35%, CDNS belongs to the best of the industry, outperforming 85.25% of the companies in the same industry.
CDNS's Profit Margin has declined in the last couple of years.
CDNS has a Operating Margin of 31.57%. This is amongst the best in the industry. CDNS outperforms 93.17% of its industry peers.
CDNS's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 85.55%, CDNS belongs to the best of the industry, outperforming 92.81% of the companies in the same industry.
In the last couple of years the Gross Margin of CDNS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 31.57% | ||
| PM (TTM) | 20.35% | ||
| GM | 85.55% |
OM growth 3Y4.75%
OM growth 5Y6.92%
PM growth 3Y-0.79%
PM growth 5Y-11.69%
GM growth 3Y-1.39%
GM growth 5Y-0.58%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CDNS is creating value.
CDNS has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, CDNS has less shares outstanding
Compared to 1 year ago, CDNS has a worse debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of CDNS is 1.68, which is an excellent value as it means it would take CDNS, only 1.68 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of CDNS (1.68) is better than 70.14% of its industry peers.
CDNS has a Debt/Equity ratio of 0.48. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.48, CDNS is doing worse than 65.11% of the companies in the same industry.
Although CDNS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 1.68 | ||
| Altman-Z | N/A |
ROIC/WACC1.44
WACC10.94%
2.3 Liquidity
CDNS has a Current Ratio of 3.05. This indicates that CDNS is financially healthy and has no problem in meeting its short term obligations.
CDNS's Current ratio of 3.05 is fine compared to the rest of the industry. CDNS outperforms 75.90% of its industry peers.
CDNS has a Quick Ratio of 2.84. This indicates that CDNS is financially healthy and has no problem in meeting its short term obligations.
CDNS's Quick ratio of 2.84 is fine compared to the rest of the industry. CDNS outperforms 74.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.05 | ||
| Quick Ratio | 2.84 |
3. Growth
3.1 Past
CDNS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 28.52%, which is quite impressive.
Measured over the past years, CDNS shows a very strong growth in Earnings Per Share. The EPS has been growing by 22.21% on average per year.
CDNS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 19.72%.
CDNS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.72% yearly.
EPS 1Y (TTM)28.52%
EPS 3Y21.73%
EPS 5Y22.21%
EPS Q2Q%17.68%
Revenue 1Y (TTM)19.72%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%10.15%
3.2 Future
CDNS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.14% yearly.
The Revenue is expected to grow by 11.93% on average over the next years. This is quite good.
EPS Next Y20.43%
EPS Next 2Y17.23%
EPS Next 3Y16.54%
EPS Next 5Y13.14%
Revenue Next Year13.94%
Revenue Next 2Y13.23%
Revenue Next 3Y13.03%
Revenue Next 5Y11.93%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 45.20, CDNS can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of CDNS is on the same level as its industry peers.
When comparing the Price/Earnings ratio of CDNS to the average of the S&P500 Index (26.59), we can say CDNS is valued expensively.
The Price/Forward Earnings ratio is 38.73, which means the current valuation is very expensive for CDNS.
CDNS's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 24.03. CDNS is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.2 | ||
| Fwd PE | 38.73 |
4.2 Price Multiples
62.23% of the companies in the same industry are more expensive than CDNS, based on the Enterprise Value to EBITDA ratio.
CDNS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 58.5 | ||
| EV/EBITDA | 46.26 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CDNS does not grow enough to justify the current Price/Earnings ratio.
CDNS has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as CDNS's earnings are expected to grow with 16.54% in the coming years.
PEG (NY)2.21
PEG (5Y)2.04
EPS Next 2Y17.23%
EPS Next 3Y16.54%
5. Dividend
5.1 Amount
CDNS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
317.76
+0.83 (+0.26%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners91.78%
Inst Owner Change0.99%
Ins Owners0.25%
Ins Owner Change-1.69%
Market Cap86.49B
Revenue(TTM)5.21B
Net Income(TTM)1.06B
Analysts80.63
Price TargetN/A
Short Float %1.62%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.96%
Min EPS beat(2)4.06%
Max EPS beat(2)5.86%
EPS beat(4)4
Avg EPS beat(4)3.6%
Min EPS beat(4)1.28%
Max EPS beat(4)5.86%
EPS beat(8)8
Avg EPS beat(8)3.98%
EPS beat(12)12
Avg EPS beat(12)3.22%
EPS beat(16)16
Avg EPS beat(16)4.67%
Revenue beat(2)1
Avg Revenue beat(2)-0.36%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)0.03%
Revenue beat(4)1
Avg Revenue beat(4)-0.92%
Min Revenue beat(4)-1.71%
Max Revenue beat(4)0.03%
Revenue beat(8)2
Avg Revenue beat(8)-0.69%
Revenue beat(12)3
Avg Revenue beat(12)-0.68%
Revenue beat(16)7
Avg Revenue beat(16)-0.18%
PT rev (1m)2.21%
PT rev (3m)4.15%
EPS NQ rev (1m)0.13%
EPS NQ rev (3m)-0.1%
EPS NY rev (1m)0.21%
EPS NY rev (3m)1.83%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.33%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)0.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.2 | ||
| Fwd PE | 38.73 | ||
| P/S | 16.59 | ||
| P/FCF | 58.5 | ||
| P/OCF | 53.5 | ||
| P/B | 16.64 | ||
| P/tB | 45.97 | ||
| EV/EBITDA | 46.26 |
EPS(TTM)7.03
EY2.21%
EPS(NY)8.2
Fwd EY2.58%
FCF(TTM)5.43
FCFY1.71%
OCF(TTM)5.94
OCFY1.87%
SpS19.15
BVpS19.1
TBVpS6.91
PEG (NY)2.21
PEG (5Y)2.04
Graham Number54.96
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.05% | ||
| ROE | 20.41% | ||
| ROCE | 20.09% | ||
| ROIC | 15.75% | ||
| ROICexc | 23.73% | ||
| ROICexgc | 60.82% | ||
| OM | 31.57% | ||
| PM (TTM) | 20.35% | ||
| GM | 85.55% | ||
| FCFM | 28.37% |
ROA(3y)15.55%
ROA(5y)15.49%
ROE(3y)28.03%
ROE(5y)26.64%
ROIC(3y)20.16%
ROIC(5y)18.92%
ROICexc(3y)28.2%
ROICexc(5y)26.78%
ROICexgc(3y)72.83%
ROICexgc(5y)62.51%
ROCE(3y)25.95%
ROCE(5y)24.28%
ROICexgc growth 3Y4.04%
ROICexgc growth 5Y11.48%
ROICexc growth 3Y-4.84%
ROICexc growth 5Y2.66%
OM growth 3Y4.75%
OM growth 5Y6.92%
PM growth 3Y-0.79%
PM growth 5Y-11.69%
GM growth 3Y-1.39%
GM growth 5Y-0.58%
F-Score7
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 1.68 | ||
| Debt/EBITDA | 1.33 | ||
| Cap/Depr | 63.33% | ||
| Cap/Sales | 2.65% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.74% | ||
| Profit Quality | 139.37% | ||
| Current Ratio | 3.05 | ||
| Quick Ratio | 2.84 | ||
| Altman-Z | N/A |
F-Score7
WACC10.94%
ROIC/WACC1.44
Cap/Depr(3y)78.99%
Cap/Depr(5y)69.81%
Cap/Sales(3y)3.02%
Cap/Sales(5y)2.97%
Profit Quality(3y)119.11%
Profit Quality(5y)128.61%
High Growth Momentum
Growth
EPS 1Y (TTM)28.52%
EPS 3Y21.73%
EPS 5Y22.21%
EPS Q2Q%17.68%
EPS Next Y20.43%
EPS Next 2Y17.23%
EPS Next 3Y16.54%
EPS Next 5Y13.14%
Revenue 1Y (TTM)19.72%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%10.15%
Revenue Next Year13.94%
Revenue Next 2Y13.23%
Revenue Next 3Y13.03%
Revenue Next 5Y11.93%
EBIT growth 1Y29.6%
EBIT growth 3Y21.31%
EBIT growth 5Y22.65%
EBIT Next Year25.41%
EBIT Next 3Y17.85%
EBIT Next 5Y16.55%
FCF growth 1Y19.71%
FCF growth 3Y2.64%
FCF growth 5Y11.29%
OCF growth 1Y20.58%
OCF growth 3Y4.62%
OCF growth 5Y11.56%
CADENCE DESIGN SYS INC / CDNS FAQ
What is the ChartMill fundamental rating of CADENCE DESIGN SYS INC (CDNS) stock?
ChartMill assigns a fundamental rating of 6 / 10 to CDNS.
What is the valuation status of CADENCE DESIGN SYS INC (CDNS) stock?
ChartMill assigns a valuation rating of 3 / 10 to CADENCE DESIGN SYS INC (CDNS). This can be considered as Overvalued.
What is the profitability of CDNS stock?
CADENCE DESIGN SYS INC (CDNS) has a profitability rating of 9 / 10.
What is the financial health of CADENCE DESIGN SYS INC (CDNS) stock?
The financial health rating of CADENCE DESIGN SYS INC (CDNS) is 6 / 10.
Can you provide the expected EPS growth for CDNS stock?
The Earnings per Share (EPS) of CADENCE DESIGN SYS INC (CDNS) is expected to grow by 20.43% in the next year.