(CDNS) Cadence Design Systems - Overview
Stock: Verification, Synthesis, Implementation, Custom, IP
| Risk 5d forecast | |
|---|---|
| Volatility | 40.6% |
| Relative Tail Risk | -8.00% |
| Reward TTM | |
|---|---|
| Sharpe Ratio | 0.33 |
| Alpha | -8.84 |
| Character TTM | |
|---|---|
| Beta | 1.324 |
| Beta Downside | 1.155 |
| Drawdowns 3y | |
|---|---|
| Max DD | 29.05% |
| CAGR/Max DD | 0.53 |
EPS (Earnings per Share)
Revenue
Description: CDNS Cadence Design Systems January 27, 2026
Cadence Design Systems (NASDAQ: CDNS) is a global provider of electronic design automation (EDA) software, hardware, and services that enable semiconductor companies to design, verify, and bring chips to market. Its portfolio spans functional verification (Jasper, Xcelium, Palladium, Protium), digital IC design and sign-off (Genus, Joules, Innovus), custom analog/mixed-signal design (Virtuoso Studio), and multi-physics system simulation, plus a suite of IP and methodology services for industries ranging from hyperscale computing to automotive and aerospace.
In its most recent fiscal year (FY 2025, ended July 31 2025), Cadence reported revenue of **$4.68 billion**, a **12.4 % year-over-year increase**, driven primarily by a 19 % rise in the Verification & Implementation segment. Gross margin expanded to **71.2 %**, while operating cash flow reached **$1.15 billion**, supporting a **$1.2 billion share repurchase** program announced in Q3 2025. R&D intensity remained high at **23 % of revenue**, underscoring continued investment in AI-assisted design tools.
The EDA market is being reshaped by three macro drivers: (1) the acceleration of AI-centric chip designs, which raises demand for high-performance verification platforms; (2) the resurgence of domestic semiconductor fabs in the U.S. and Europe, increasing the need for advanced design-for-manufacturability solutions; and (3) the rollout of 5G and early-stage 6G infrastructure, expanding the automotive and hyperscale computing addressable base. Cadence’s recent launch of **Cadence AI-Assist**, a machine-learning-powered synthesis engine, positions it to capture a growing share of the AI-chip design spend, which analysts estimate will grow at **c. 15 % CAGR** through 2030.
For a deeper, data-driven view of Cadence’s valuation dynamics, you may find the free analytical tools on ValueRay useful for extending this initial assessment.
Piotroski VR‑10 (Strict, 0-10) 7.5
| Net Income: 1.11b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.15 > 0.02 and ΔFCF/TA 3.95 > 1.0 |
| NWC/Revenue: 57.29% < 20% (prev 57.01%; Δ 0.28% < -1%) |
| CFO/TA 0.16 > 3% & CFO 1.62b > Net Income 1.11b |
| Net Debt (-521.2m) to EBITDA (1.74b): -0.30 < 3 |
| Current Ratio: 2.86 > 1.5 & < 3 |
| Outstanding Shares: last quarter (272.9m) vs 12m ago -0.50% < -2% |
| Gross Margin: error (current vs previous; cannot be calculated due to missing/invalid data or negative margin) |
| Asset Turnover: 55.38% > 50% (prev 51.72%; Δ 3.67% > 0%) |
| Interest Coverage Ratio: 9.58 > 6 (EBITDA TTM 1.74b / Interest Expense TTM 116.5m) |
Altman Z'' 6.13
| A: 0.30 (Total Current Assets 4.67b - Total Current Liabilities 1.64b) / Total Assets 10.15b |
| B: 0.66 (Retained Earnings 6.71b / Total Assets 10.15b) |
| C: 0.12 (EBIT TTM 1.12b / Avg Total Assets 9.56b) |
| D: 1.17 (Book Value of Equity 5.47b / Total Liabilities 4.68b) |
| Altman-Z'' Score: 6.13 = AAA |
Beneish M -2.89
| DSRI: 1.22 (Receivables 944.9m/680.5m, Revenue 5.30b/4.64b) |
| GMI: 0.89 (GM 96.16% / 86.05%) |
| AQI: 1.01 (AQ_t 0.49 / AQ_t-1 0.49) |
| SGI: 1.14 (Revenue 5.30b / 4.64b) |
| TATA: -0.05 (NI 1.11b - CFO 1.62b) / TA 10.15b) |
| Beneish M-Score: -2.89 (Cap -4..+1) = A |
What is the price of CDNS shares?
Over the past week, the price has changed by -1.06%, over one month by -3.49%, over three months by -1.94% and over the past year by +9.64%.
Is CDNS a buy, sell or hold?
- StrongBuy: 14
- Buy: 5
- Hold: 3
- Sell: 0
- StrongSell: 1
What are the forecasts/targets for the CDNS price?
| Issuer | Target | Up/Down from current |
|---|---|---|
| Wallstreet Target Price | 372.8 | 25.8% |
| Analysts Target Price | 372.8 | 25.8% |
CDNS Fundamental Data Overview February 20, 2026
P/E Forward = 44.0529
P/S = 15.5042
P/B = 15.5284
P/EG = 3.0796
Revenue TTM = 5.30b USD
EBIT TTM = 1.12b USD
EBITDA TTM = 1.74b USD
Long Term Debt = 2.48b USD (from longTermDebt, two quarters ago)
Short Term Debt = unknown (none)
Debt = 2.48b USD (from shortLongTermDebtTotal, last quarter)
Net Debt = -521.2m USD (from netDebt column, last quarter)
Enterprise Value = 80.30b USD (80.82b + Debt 2.48b - CCE 3.00b)
Interest Coverage Ratio = 9.58 (Ebit TTM 1.12b / Interest Expense TTM 116.5m)
EV/FCF = 54.31x (Enterprise Value 80.30b / FCF TTM 1.48b)
FCF Yield = 1.84% (FCF TTM 1.48b / Enterprise Value 80.30b)
FCF Margin = 27.92% (FCF TTM 1.48b / Revenue TTM 5.30b)
Net Margin = 20.94% (Net Income TTM 1.11b / Revenue TTM 5.30b)
Gross Margin = unknown ((Revenue TTM 5.30b - Cost of Revenue TTM 203.6m) / Revenue TTM)
Tobins Q-Ratio = 7.91 (Enterprise Value 80.30b / Total Assets 10.15b)
Interest Expense / Debt = 1.19% (Interest Expense 29.4m / Debt 2.48b)
Taxrate = 21.26% (104.8m / 493.0m)
NOPAT = 878.8m (EBIT 1.12b * (1 - 21.26%))
Current Ratio = 2.86 (Total Current Assets 4.67b / Total Current Liabilities 1.64b)
Debt / Equity = 0.45 (Debt 2.48b / totalStockholderEquity, last quarter 5.47b)
Debt / EBITDA = -0.30 (Net Debt -521.2m / EBITDA 1.74b)
Debt / FCF = -0.35 (Net Debt -521.2m / FCF TTM 1.48b)
Total Stockholder Equity = 5.11b (last 4 quarters mean from totalStockholderEquity)
RoA = 11.59% (Net Income 1.11b / Total Assets 10.15b)
RoE = 21.68% (Net Income TTM 1.11b / Total Stockholder Equity 5.11b)
RoCE = 14.70% (EBIT 1.12b / Capital Employed (Equity 5.11b + L.T.Debt 2.48b))
RoIC = 11.76% (NOPAT 878.8m / Invested Capital 7.47b)
WACC = 10.51% (E(80.82b)/V(83.30b) * Re(10.80%) + D(2.48b)/V(83.30b) * Rd(1.19%) * (1-Tc(0.21)))
Discount Rate = 10.80% (= CAPM, Blume Beta Adj.)
Shares Correlation 3-Years: 33.33 | Cagr: 0.09%
[DCF Debug] Terminal Value 70.97% ; FCFF base≈1.27b ; Y1≈1.38b ; Y5≈1.72b
Fair Price DCF = 75.05 (EV 19.91b - Net Debt -521.2m = Equity 20.43b / Shares 272.2m; r=10.51% [WACC]; 5y FCF grow 9.81% → 2.90% )
EPS Correlation: 89.03 | EPS CAGR: 15.22% | SUE: 1.45 | # QB: 11
Revenue Correlation: 95.52 | Revenue CAGR: 13.30% | SUE: 1.37 | # QB: 3
EPS next Quarter (2026-03-31): EPS=1.93 | Chg30d=+0.119 | Revisions Net=+8 | Analysts=18
EPS current Year (2026-12-31): EPS=5.07 | Chg30d=-0.283 | Revisions Net=+0 | Growth EPS=+24.8% | Growth Revenue=+12.7%
EPS next Year (2027-12-31): EPS=9.26 | Chg30d=+0.036 | Revisions Net=+1 | Growth EPS=+13.6% | Growth Revenue=+12.0%