313.17 USD
-9.89 (-3.06%)
312 USD
-1.17 (-0.37%)
Overall CDNS gets a fundamental rating of 6 out of 10. We evaluated CDNS against 276 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 is valued quite expensive, but it does show an excellent growth. These ratings could make CDNS a good candidate 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.
- Each year in the past 5 years CDNS had a positive operating cash flow.
1.2 Ratios
- With an excellent Return On Assets value of 11.05%, CDNS belongs to the best of the industry, outperforming 86.23% of the companies in the same industry.
- CDNS's Return On Equity of 20.41% is amongst the best of the industry. CDNS outperforms 88.04% of its industry peers.
- CDNS has a better Return On Invested Capital (15.75%) than 92.75% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for CDNS is significantly above the industry average of 10.78%.
- The last Return On Invested Capital (15.75%) for CDNS is well below the 3 year average (20.16%), which needs to be investigated, but indicates that CDNS had better years and this may not be a problem.
| 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 better Profit Margin (20.35%) than 84.42% of its industry peers.
- In the last couple of years the Profit Margin of CDNS has declined.
- Looking at the Operating Margin, with a value of 31.57%, CDNS belongs to the top of the industry, outperforming 93.12% of the companies in the same industry.
- In the last couple of years the Operating Margin of CDNS has grown nicely.
- CDNS has a better Gross Margin (85.55%) than 93.12% of its industry peers.
- 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
- The debt/assets ratio for CDNS is higher compared to a year ago.
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.
- CDNS has a better Debt to FCF ratio (1.68) than 70.29% 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.
- With a Debt to Equity ratio value of 0.48, CDNS is not doing good in the industry: 65.22% of the companies in the same industry are doing better.
- 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/WACC1.44
WACC10.95%
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 has a Current ratio of 3.05. This is in the better half of the industry: CDNS outperforms 75.72% of its industry peers.
- A Quick Ratio of 2.84 indicates that CDNS has no problem at all paying its short term obligations.
- CDNS has a better Quick ratio (2.84) than 74.64% of its industry peers.
| 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 Y20.43%
EPS Next 2Y17.24%
EPS Next 3Y16.29%
EPS Next 5Y13.14%
Revenue Next Year13.96%
Revenue Next 2Y13.23%
Revenue Next 3Y12.93%
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
- A Price/Earnings ratio of 44.55 indicates a quite expensive valuation of CDNS.
- Compared to the rest of the industry, the Price/Earnings ratio of CDNS is on the same level as its industry peers.
- CDNS is valuated expensively when we compare the Price/Earnings ratio to 27.33, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 38.16, the valuation of CDNS can be described as expensive.
- The rest of the industry has a similar Price/Forward Earnings ratio as CDNS.
- CDNS is valuated expensively when we compare the Price/Forward Earnings ratio to 24.12, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.55 | ||
| Fwd PE | 38.16 |
4.2 Price Multiples
- CDNS's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CDNS is cheaper than 62.68% of the companies in the same industry.
- CDNS's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 57.65 | ||
| EV/EBITDA | 47.04 |
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 16.29% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.18
PEG (5Y)2.01
EPS Next 2Y17.24%
EPS Next 3Y16.29%
5. Dividend
5.1 Amount
- CDNS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
313.17
-9.89 (-3.06%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)10-27 2025-10-27/amc
Earnings (Next)02-17 2026-02-17/amc
Inst Owners91.74%
Inst Owner Change0.27%
Ins Owners0.25%
Ins Owner Change-1.68%
Market Cap85.24B
Revenue(TTM)5.21B
Net Income(TTM)1.06B
Analysts81.88
Price Target390.48 (24.69%)
Short Float %1.48%
Short Ratio2.27
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)-0.28%
PT rev (3m)3.86%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.1%
EPS NY rev (1m)0%
EPS NY rev (3m)1.86%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.33%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)0.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.55 | ||
| Fwd PE | 38.16 | ||
| P/S | 16.35 | ||
| P/FCF | 57.65 | ||
| P/OCF | 52.73 | ||
| P/B | 16.4 | ||
| P/tB | 45.3 | ||
| EV/EBITDA | 47.04 |
EPS(TTM)7.03
EY2.24%
EPS(NY)8.21
Fwd EY2.62%
FCF(TTM)5.43
FCFY1.73%
OCF(TTM)5.94
OCFY1.9%
SpS19.15
BVpS19.1
TBVpS6.91
PEG (NY)2.18
PEG (5Y)2.01
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
WACC10.95%
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 2Y17.24%
EPS Next 3Y16.29%
EPS Next 5Y13.14%
Revenue 1Y (TTM)19.72%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%10.15%
Revenue Next Year13.96%
Revenue Next 2Y13.23%
Revenue Next 3Y12.93%
Revenue Next 5Y11.93%
EBIT growth 1Y29.6%
EBIT growth 3Y21.31%
EBIT growth 5Y22.65%
EBIT Next Year23.27%
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 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 6 / 10.