299.65 USD
+0.65 (+0.22%)
At close: Feb 11, 2026
299.65 USD
0 (0%)
After Hours: 2/11/2026, 5:20:02 PM
Taking everything into account, CDNS scores 6 out of 10 in our fundamental rating. CDNS was compared to 277 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 expensively, but it does show have an excellent growth rating. 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.
- Each year in the past 5 years CDNS has been profitable.
- CDNS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- CDNS's Return On Assets of 11.05% is amongst the best of the industry. CDNS outperforms 86.28% of its industry peers.
- With an excellent Return On Equity value of 20.41%, CDNS belongs to the best of the industry, outperforming 87.73% of the companies in the same industry.
- The Return On Invested Capital of CDNS (15.75%) is better than 92.42% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for CDNS 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
- CDNS has a Profit Margin of 20.35%. This is amongst the best in the industry. CDNS outperforms 84.84% of its industry peers.
- CDNS's Profit Margin has declined in the last couple of years.
- With an excellent Operating Margin value of 31.57%, CDNS belongs to the best of the industry, outperforming 92.78% of the companies in the same industry.
- CDNS's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 85.55%, CDNS belongs to the top of the industry, outperforming 92.42% of the companies in the same industry.
- 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.
- CDNS has less shares outstanding than it did 5 years ago.
- 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.
- Looking at the Debt to FCF ratio, with a value of 1.68, CDNS is in the better half of the industry, outperforming 69.68% of the companies in the same industry.
- 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: 66.06% of the companies in the same industry are doing better.
- 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/WACC1.43
WACC11.04%
2.3 Liquidity
- A Current Ratio of 3.05 indicates that CDNS has no problem at all paying its short term obligations.
- CDNS has a better Current ratio (3.05) than 75.09% 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 74.37% 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
- Looking at the last year, CDNS shows a quite strong growth in Revenue. The Revenue has grown by 19.72% in the last year.
- Measured over the past years, CDNS shows a quite strong growth in Revenue. The Revenue has been growing by 14.72% on average per year.
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
- Based on estimates for the next years, CDNS will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.14% on average per year.
- 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 Y20.58%
EPS Next 2Y17.3%
EPS Next 3Y16.39%
EPS Next 5Y13.14%
Revenue Next Year13.96%
Revenue Next 2Y13.23%
Revenue Next 3Y12.93%
Revenue Next 5Y11.93%
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.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 42.62, the valuation of CDNS can be described as expensive.
- CDNS's Price/Earnings is on the same level as the industry average.
- CDNS is valuated expensively when we compare the Price/Earnings ratio to 28.03, which is the current average of the S&P500 Index.
- CDNS is valuated quite expensively with a Price/Forward Earnings ratio of 36.48.
- CDNS's Price/Forward Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Forward Earnings ratio of 27.97, CDNS is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.62 | ||
| Fwd PE | 36.48 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CDNS is on the same level as its industry peers.
- The rest of the industry has a similar Price/Free Cash Flow ratio as CDNS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 55.16 | ||
| EV/EBITDA | 43.52 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- 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 16.39% in the coming years.
PEG (NY)2.07
PEG (5Y)1.92
EPS Next 2Y17.3%
EPS Next 3Y16.39%
5. Dividend
5.1 Amount
- CDNS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
299.65
+0.65 (+0.22%)
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 Change-2.22%
Ins Owners0.25%
Ins Owner Change-1.68%
Market Cap81.56B
Revenue(TTM)5.21B
Net Income(TTM)1.06B
Analysts81.88
Price Target388.73 (29.73%)
Short Float %1.62%
Short Ratio2.56
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)-0.45%
PT rev (3m)1.47%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.13%
EPS NY rev (1m)0.12%
EPS NY rev (3m)0.34%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.62 | ||
| Fwd PE | 36.48 | ||
| P/S | 15.65 | ||
| P/FCF | 55.16 | ||
| P/OCF | 50.45 | ||
| P/B | 15.69 | ||
| P/tB | 43.35 | ||
| EV/EBITDA | 43.52 |
EPS(TTM)7.03
EY2.35%
EPS(NY)8.21
Fwd EY2.74%
FCF(TTM)5.43
FCFY1.81%
OCF(TTM)5.94
OCFY1.98%
SpS19.15
BVpS19.1
TBVpS6.91
PEG (NY)2.07
PEG (5Y)1.92
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
WACC11.04%
ROIC/WACC1.43
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 Y20.58%
EPS Next 2Y17.3%
EPS Next 3Y16.39%
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 2 / 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.