CADENCE DESIGN SYS INC (CDNS) Fundamental Analysis & Valuation

NASDAQ:CDNS • US1273871087

Current stock price

287.03 USD
-3.29 (-1.13%)
At close:
287.03 USD
0 (0%)
After Hours:

This CDNS fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

9

1. CDNS Profitability Analysis

1.1 Basic Checks

  • In the past year CDNS was profitable.
  • CDNS had a positive operating cash flow in the past year.
  • In the past 5 years CDNS has always been profitable.
  • In the past 5 years CDNS always reported a positive cash flow from operatings.
CDNS Yearly Net Income VS EBIT VS OCF VS FCFCDNS Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B

1.2 Ratios

  • CDNS has a Return On Assets of 10.92%. This is amongst the best in the industry. CDNS outperforms 86.64% of its industry peers.
  • The Return On Equity of CDNS (20.26%) is better than 86.64% of its industry peers.
  • With an excellent Return On Invested Capital value of 14.48%, CDNS belongs to the best of the industry, outperforming 92.06% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years for CDNS is significantly above the industry average of 10.89%.
Industry RankSector Rank
ROA 10.92%
ROE 20.26%
ROIC 14.48%
ROA(3y)13.68%
ROA(5y)14.69%
ROE(3y)24.47%
ROE(5y)25.95%
ROIC(3y)17.13%
ROIC(5y)17.76%
CDNS Yearly ROA, ROE, ROICCDNS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30 40

1.3 Margins

  • Looking at the Profit Margin, with a value of 20.94%, CDNS belongs to the top of the industry, outperforming 87.36% of the companies in the same industry.
  • In the last couple of years the Profit Margin of CDNS has remained more or less at the same level.
  • CDNS has a better Operating Margin (31.36%) than 94.95% of its industry peers.
  • In the last couple of years the Operating Margin of CDNS has grown nicely.
  • The Gross Margin of CDNS (86.36%) is better than 92.42% of its industry peers.
  • CDNS's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 31.36%
PM (TTM) 20.94%
GM 86.36%
OM growth 3Y1.71%
OM growth 5Y5.38%
PM growth 3Y-4.23%
PM growth 5Y-1%
GM growth 3Y-1.21%
GM growth 5Y-0.51%
CDNS Yearly Profit, Operating, Gross MarginsCDNS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60 80

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ROAROEROICOperating and Profit MarginShow most profitable peers

8

2. CDNS Health Analysis

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CDNS is still creating some value.
  • The number of shares outstanding for CDNS has been reduced compared to 1 year ago.
  • Compared to 5 years ago, CDNS has less shares outstanding
  • CDNS has a better debt/assets ratio than last year.
CDNS Yearly Shares OutstandingCDNS Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M 200M 250M
CDNS Yearly Total Debt VS Total AssetsCDNS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B 10B

2.2 Solvency

  • An Altman-Z score of 12.55 indicates that CDNS is not in any danger for bankruptcy at the moment.
  • The Altman-Z score of CDNS (12.55) is better than 94.58% of its industry peers.
  • CDNS has a debt to FCF ratio of 1.56. This is a very positive value and a sign of high solvency as it would only need 1.56 years to pay back of all of its debts.
  • CDNS has a better Debt to FCF ratio (1.56) than 70.40% of its industry peers.
  • A Debt/Equity ratio of 0.45 indicates that CDNS is not too dependend on debt financing.
  • Looking at the Debt to Equity ratio, with a value of 0.45, CDNS is doing worse than 64.26% of the companies in the same industry.
  • Although CDNS's pure debt/equity ratio does not look good, it has limited outstanding debt compared to the Free Cash Flow. 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 RankSector Rank
Debt/Equity 0.45
Debt/FCF 1.56
Altman-Z 12.55
ROIC/WACC1.33
WACC10.91%
CDNS Yearly LT Debt VS Equity VS FCFCDNS Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B 5B

2.3 Liquidity

  • CDNS has a Current Ratio of 2.86. This indicates that CDNS is financially healthy and has no problem in meeting its short term obligations.
  • CDNS has a Current ratio of 2.86. This is in the better half of the industry: CDNS outperforms 72.56% of its industry peers.
  • A Quick Ratio of 2.67 indicates that CDNS has no problem at all paying its short term obligations.
  • Looking at the Quick ratio, with a value of 2.67, CDNS is in the better half of the industry, outperforming 71.12% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.86
Quick Ratio 2.67
CDNS Yearly Current Assets VS Current LiabilitesCDNS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

7

3. CDNS Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an nice 19.60% over the past year.
  • The Earnings Per Share has been growing by 20.68% on average over the past years. This is a very strong growth
  • Looking at the last year, CDNS shows a quite strong growth in Revenue. The Revenue has grown by 14.12% in the last year.
  • Measured over the past years, CDNS shows a quite strong growth in Revenue. The Revenue has been growing by 14.57% on average per year.
EPS 1Y (TTM)19.6%
EPS 3Y18.69%
EPS 5Y20.68%
EPS Q2Q%5.85%
Revenue 1Y (TTM)14.12%
Revenue growth 3Y14.14%
Revenue growth 5Y14.57%
Sales Q2Q%6.2%

3.2 Future

  • The Earnings Per Share is expected to grow by 14.49% on average over the next years. This is quite good.
  • Based on estimates for the next years, CDNS will show a quite strong growth in Revenue. The Revenue will grow by 12.98% on average per year.
EPS Next Y15.46%
EPS Next 2Y15.17%
EPS Next 3Y13.6%
EPS Next 5Y14.49%
Revenue Next Year13.87%
Revenue Next 2Y13.12%
Revenue Next 3Y13.02%
Revenue Next 5Y12.98%

3.3 Evolution

  • The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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.
CDNS Yearly Revenue VS EstimatesCDNS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2B 4B 6B 8B 10B
CDNS Yearly EPS VS EstimatesCDNS Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 5 10 15 20

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Find the best growth stocksShow best growing peers

3

4. CDNS Valuation Analysis

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 40.20, CDNS can be considered very expensive at the moment.
  • The rest of the industry has a similar Price/Earnings ratio as CDNS.
  • CDNS is valuated expensively when we compare the Price/Earnings ratio to 25.70, which is the current average of the S&P500 Index.
  • CDNS is valuated quite expensively with a Price/Forward Earnings ratio of 34.82.
  • The rest of the industry has a similar Price/Forward Earnings ratio as CDNS.
  • The average S&P500 Price/Forward Earnings ratio is at 23.84. CDNS is valued slightly more expensive when compared to this.
Industry RankSector Rank
PE 40.2
Fwd PE 34.82
CDNS Price Earnings VS Forward Price EarningsCDNS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, CDNS is valued a bit cheaper than 61.01% of the companies in the same industry.
  • CDNS's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 49.9
EV/EBITDA 41.48
CDNS Per share dataCDNS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

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 13.60% in the coming years.
PEG (NY)2.6
PEG (5Y)1.94
EPS Next 2Y15.17%
EPS Next 3Y13.6%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

0

5. CDNS Dividend Analysis

5.1 Amount

  • CDNS does not give a dividend.
Industry RankSector Rank
Dividend Yield 0%

More info and screens

Find the best dividend stocksShow peers with best dividend

CDNS Fundamentals: All Metrics, Ratios and Statistics

CADENCE DESIGN SYS INC

NASDAQ:CDNS (3/13/2026, 8:14:28 PM)

After market: 287.03 0 (0%)

287.03

-3.29 (-1.13%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)02-17
Earnings (Next)04-27
Inst Owners89.74%
Inst Owner Change3.04%
Ins Owners0.24%
Ins Owner Change-1.43%
Market Cap79.19B
Revenue(TTM)5.30B
Net Income(TTM)1.11B
Analysts83.13
Price Target379.71 (32.29%)
Short Float %1.85%
Short Ratio2.09
Dividend
Industry RankSector 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)3.92%
Min EPS beat(2)1.98%
Max EPS beat(2)5.86%
EPS beat(4)4
Avg EPS beat(4)3.78%
Min EPS beat(4)1.98%
Max EPS beat(4)5.86%
EPS beat(8)8
Avg EPS beat(8)4.05%
EPS beat(12)12
Avg EPS beat(12)3.19%
EPS beat(16)16
Avg EPS beat(16)4.44%
Revenue beat(2)0
Avg Revenue beat(2)-0.79%
Min Revenue beat(2)-0.82%
Max Revenue beat(2)-0.75%
Revenue beat(4)1
Avg Revenue beat(4)-0.81%
Min Revenue beat(4)-1.71%
Max Revenue beat(4)0.03%
Revenue beat(8)2
Avg Revenue beat(8)-0.64%
Revenue beat(12)3
Avg Revenue beat(12)-0.73%
Revenue beat(16)6
Avg Revenue beat(16)-0.24%
PT rev (1m)-2.32%
PT rev (3m)-3.03%
EPS NQ rev (1m)6.2%
EPS NQ rev (3m)6.2%
EPS NY rev (1m)0.36%
EPS NY rev (3m)0.48%
Revenue NQ rev (1m)4.55%
Revenue NQ rev (3m)4.55%
Revenue NY rev (1m)1.22%
Revenue NY rev (3m)1.22%
Valuation
Industry RankSector Rank
PE 40.2
Fwd PE 34.82
P/S 14.95
P/FCF 49.9
P/OCF 45.8
P/B 14.47
P/tB 39.46
EV/EBITDA 41.48
EPS(TTM)7.14
EY2.49%
EPS(NY)8.24
Fwd EY2.87%
FCF(TTM)5.75
FCFY2%
OCF(TTM)6.27
OCFY2.18%
SpS19.2
BVpS19.84
TBVpS7.27
PEG (NY)2.6
PEG (5Y)1.94
Graham Number56.46
Profitability
Industry RankSector Rank
ROA 10.92%
ROE 20.26%
ROCE 19.5%
ROIC 14.48%
ROICexc 23%
ROICexgc 65.08%
OM 31.36%
PM (TTM) 20.94%
GM 86.36%
FCFM 29.96%
ROA(3y)13.68%
ROA(5y)14.69%
ROE(3y)24.47%
ROE(5y)25.95%
ROIC(3y)17.13%
ROIC(5y)17.76%
ROICexc(3y)25.61%
ROICexc(5y)25.63%
ROICexgc(3y)70.1%
ROICexgc(5y)64.45%
ROCE(3y)23.08%
ROCE(5y)24.07%
ROICexgc growth 3Y1.82%
ROICexgc growth 5Y10.8%
ROICexc growth 3Y-4.26%
ROICexc growth 5Y1.27%
OM growth 3Y1.71%
OM growth 5Y5.38%
PM growth 3Y-4.23%
PM growth 5Y-1%
GM growth 3Y-1.21%
GM growth 5Y-0.51%
F-Score7
Asset Turnover0.52
Health
Industry RankSector Rank
Debt/Equity 0.45
Debt/FCF 1.56
Debt/EBITDA 1.31
Cap/Depr 62.27%
Cap/Sales 2.68%
Interest Coverage 14.84
Cash Conversion 91.51%
Profit Quality 143.11%
Current Ratio 2.86
Quick Ratio 2.67
Altman-Z 12.55
F-Score7
WACC10.91%
ROIC/WACC1.33
Cap/Depr(3y)68.4%
Cap/Depr(5y)69.25%
Cap/Sales(3y)2.75%
Cap/Sales(5y)2.8%
Profit Quality(3y)122.92%
Profit Quality(5y)129.8%
High Growth Momentum
Growth
EPS 1Y (TTM)19.6%
EPS 3Y18.69%
EPS 5Y20.68%
EPS Q2Q%5.85%
EPS Next Y15.46%
EPS Next 2Y15.17%
EPS Next 3Y13.6%
EPS Next 5Y14.49%
Revenue 1Y (TTM)14.12%
Revenue growth 3Y14.14%
Revenue growth 5Y14.57%
Sales Q2Q%6.2%
Revenue Next Year13.87%
Revenue Next 2Y13.12%
Revenue Next 3Y13.02%
Revenue Next 5Y12.98%
EBIT growth 1Y19.58%
EBIT growth 3Y16.1%
EBIT growth 5Y20.74%
EBIT Next Year21.71%
EBIT Next 3Y15.52%
EBIT Next 5Y15.44%
FCF growth 1Y41.94%
FCF growth 3Y12.39%
FCF growth 5Y14.39%
OCF growth 1Y37.14%
OCF growth 3Y11.66%
OCF growth 5Y13.82%

CADENCE DESIGN SYS INC / CDNS Fundamental Analysis FAQ

What is the ChartMill fundamental rating of CADENCE DESIGN SYS INC (CDNS) stock?

ChartMill assigns a fundamental rating of 7 / 10 to CDNS.


What is the valuation status for CDNS stock?

ChartMill assigns a valuation rating of 3 / 10 to CADENCE DESIGN SYS INC (CDNS). This can be considered as Overvalued.


Can you provide the profitability details for CADENCE DESIGN SYS INC?

CADENCE DESIGN SYS INC (CDNS) has a profitability rating of 9 / 10.


How financially healthy is CADENCE DESIGN SYS INC?

The financial health rating of CADENCE DESIGN SYS INC (CDNS) is 8 / 10.