311.84 USD
+5.49 (+1.79%)
313.08 USD
+1.24 (+0.4%)
CDNS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 281 industry peers in the Software industry. While CDNS belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. CDNS shows excellent growth, but is valued quite expensive already. This makes CDNS very considerable 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.
CDNS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 11.05%, CDNS belongs to the top of the industry, outperforming 86.12% of the companies in the same industry.
CDNS's Return On Equity of 20.41% is amongst the best of the industry. CDNS outperforms 87.54% of its industry peers.
Looking at the Return On Invested Capital, with a value of 15.75%, CDNS belongs to the top of the industry, outperforming 92.17% 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 12.00%.
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
CDNS has a Profit Margin of 20.35%. This is amongst the best in the industry. CDNS outperforms 85.41% of its industry peers.
In the last couple of years the Profit Margin of CDNS has declined.
CDNS has a Operating Margin of 31.57%. This is amongst the best in the industry. CDNS outperforms 93.59% of its industry peers.
CDNS's Operating Margin has improved in the last couple of years.
CDNS has a Gross Margin of 85.55%. This is amongst the best in the industry. CDNS outperforms 93.24% of its industry peers.
CDNS's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so CDNS is creating value.
CDNS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for CDNS has been reduced compared to 5 years ago.
CDNS has a worse debt/assets ratio than last year.
2.2 Solvency
CDNS has a debt to FCF ratio of 1.68. This is a very positive value and a sign of high solvency as it would only need 1.68 years to pay back of all of its debts.
CDNS has a Debt to FCF ratio of 1.68. This is in the better half of the industry: CDNS outperforms 70.46% 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.
CDNS's Debt to Equity ratio of 0.48 is on the low side compared to the rest of the industry. CDNS is outperformed by 64.06% of its industry peers.
Even though the debt/equity ratio score it not favorable for CDNS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 1.68 | ||
| Altman-Z | N/A |
ROIC/WACC1.47
WACC10.72%
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.
With a decent Current ratio value of 3.05, CDNS is doing good in the industry, outperforming 76.87% of the companies in the same industry.
A Quick Ratio of 2.84 indicates that CDNS has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.84, CDNS is in the better half of the industry, outperforming 76.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.05 | ||
| Quick Ratio | 2.84 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 28.52% over the past year.
The Earnings Per Share has been growing by 22.21% on average over the past years. This is a very strong growth
The Revenue has grown by 19.72% in the past year. This is quite good.
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.
Based on estimates for the next years, CDNS will show a quite strong growth in Revenue. The Revenue will grow by 11.93% on average per year.
EPS Next Y20.18%
EPS Next 2Y17.15%
EPS Next 3Y16.37%
EPS Next 5Y13.14%
Revenue Next Year13.92%
Revenue Next 2Y13.13%
Revenue Next 3Y12.96%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 44.36, which means the current valuation is very expensive for CDNS.
CDNS's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of CDNS to the average of the S&P500 Index (26.31), we can say CDNS is valued expensively.
A Price/Forward Earnings ratio of 38.06 indicates a quite expensive valuation of CDNS.
The rest of the industry has a similar Price/Forward Earnings ratio as CDNS.
When comparing the Price/Forward Earnings ratio of CDNS to the average of the S&P500 Index (36.56), we can say CDNS is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.36 | ||
| Fwd PE | 38.06 |
4.2 Price Multiples
64.06% of the companies in the same industry are more expensive than CDNS, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CDNS is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 57.41 | ||
| EV/EBITDA | 45.4 |
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.
CDNS's earnings are expected to grow with 16.37% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.2
PEG (5Y)2
EPS Next 2Y17.15%
EPS Next 3Y16.37%
5. Dividend
5.1 Amount
No dividends for CDNS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
311.84
+5.49 (+1.79%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.17%
Inst Owner Change0.94%
Ins Owners0.26%
Ins Owner Change-1.52%
Market Cap84.88B
Revenue(TTM)5.21B
Net Income(TTM)1.06B
Analysts78.67
Price Target389.05 (24.76%)
Short Float %1.32%
Short Ratio1.87
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)1.55%
PT rev (3m)4.57%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-0.24%
EPS NY rev (1m)2.89%
EPS NY rev (3m)1.61%
Revenue NQ rev (1m)0.41%
Revenue NQ rev (3m)1.33%
Revenue NY rev (1m)0.62%
Revenue NY rev (3m)0.62%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.36 | ||
| Fwd PE | 38.06 | ||
| P/S | 16.28 | ||
| P/FCF | 57.41 | ||
| P/OCF | 52.51 | ||
| P/B | 16.33 | ||
| P/tB | 45.11 | ||
| EV/EBITDA | 45.4 |
EPS(TTM)7.03
EY2.25%
EPS(NY)8.19
Fwd EY2.63%
FCF(TTM)5.43
FCFY1.74%
OCF(TTM)5.94
OCFY1.9%
SpS19.15
BVpS19.1
TBVpS6.91
PEG (NY)2.2
PEG (5Y)2
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
WACC10.72%
ROIC/WACC1.47
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 Y20.18%
EPS Next 2Y17.15%
EPS Next 3Y16.37%
EPS Next 5Y13.14%
Revenue 1Y (TTM)19.72%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%10.15%
Revenue Next Year13.92%
Revenue Next 2Y13.13%
Revenue Next 3Y12.96%
Revenue Next 5Y11.93%
EBIT growth 1Y29.6%
EBIT growth 3Y21.31%
EBIT growth 5Y22.65%
EBIT Next Year22.62%
EBIT Next 3Y17.75%
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 20.18% in the next year.