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Cadence Design Systems Inc.
CDNS
265.66 (-4.99%) 13.24
Information Technology
Software
Cadence Design Systems Inc. develops computational AI‑driven software hardware and silicon intellectual property products and solutions. The company offers functional verification services such as Jasper a formal verification platform; Xcelium a parallel logic simulation platform; Verisium a generative AI solution; Palladium an enterprise emulation platform; and Protium a prototyping platform for chip verification as well as digital IC design and sign off products including Innovus platform; and custom IC design and simulation product include Virtuoso a platform to design and verify analog. It also provides Xcelium logic simulator and other front-end verification and virtual prototyping technologies; controllers and physical interfaces; PCI express universal accelerator and compute express links and multiple memory interfaces; and Tensilica a digital signal processor. In addition the company’s design IP portfolio includes serializer/deserializer peripheral component interconnect USB and other standard protocols; and Secure‑IC a solution for embedded security IP. Additionally it provides System Design and Analysis (SD&A) platform a solution that enables end‑to‑end system‑level design and verification across chips packages PCBs and electronic systems; Allegro X and OrCAD X platforms for PCB and advanced packaging; Sigrity X for signal and power integrity; AWR for RF design; Fidelity for computational fluid dynamics; Celsius for thermal and airflow analysis; Clarity 3D solver for electromagnetic and power electronics analysis and simulation; Integrity 3D‑IC solution for 3D‑IC and multi‑chiplet designs; the Optimality Intelligent System Explorer Reality digital twin and Millennium enterprise multiphysics platforms; Allegro system design platform; and molecular modeling and simulation solutions and services. The company has a strategic collaboration with NVIDIA for the development of engineering solutions tailored for agentic AI chip and system design. The company was incorporated in 1987 and is headquartered in San Jose California.

Quality Checklist 8/8

5Y Shares Out Change < 0%
ROIC > 10%
Debt/Equity < 1
Current Ratio > 1
Quick Ratio > 1
Net Margin > 10%
Past Net Income CAGR > 0%
Est. EPS Growth > 5%
0.0%of Portfolio

My holdings

Day change:
Total change:
Shares:
Cost basis:
Market cap: $73.35(B)
EV: $70.75(B)
Total Equity: $5.47(B)
Earnings date: Apr-27-2026
P/E: 64.95
Forward P/E: 33.76
P/FCF: 45.49
P/S: 13.61
P/B: 13.19
EPS: $4.1
EPS (fwd): $7.9
FCF/share: $5.8
Revenue/share: $19.5
Book value/share: $20.1
ROIC: 14.1%
ROA: 11.3%
ROE: 21.7%
Debt/Equity: 0.49
Current Ratio: 2.90
Gross margin: 86.4%
Operating margin: 31.5%
Net margin: 20.9%
Dividend/share: $0.0
Div. yield: 0.00%

CDNS Valuation & Price Targets

Current Price
$266

Favorite Valuation Methods

More Valuation Methods

DCF (simple)
N/A
N/A
DCF (exit mult.)
N/A
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DDM
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EPS growth
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Revenue growth
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Peter Lynch FV
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Graham No.
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PEvaluation

47% overvalued
Low
$106
Mid
$142
High
$177
Current price
$266
Fair P/E
Margin of safety
EPS
Market Model
ROICRevenue growthFCF MarginShares outstan...Debt/EquityDebt/EBITDA
Economic moat: None/narrow

EPS Estimates

LowAvgHigh#
FY+17.87.98.07
FY+29.29.49.87
FY+310.610.911.22

Analyst Price Targets

42% undervalued
Low
$275
Mid
$377
High
$410
Current price
$266

Analyst Recommendations

Strong Buy5
Buy18
Hold3
Sell0
Strong Sell0

2-stage DCF

First Stage Duration: 5 Years
Starting Free Cash Flow
First Stage Growth Rate
LowMidHigh
Terminal Growth Rate
LowMidHigh
Discount Rate

Discounted Cash Flow

Forecast years: 5 Years
Terminal Growth Rate
LowMidHigh
Discount Rate
Free cash flow estimates:
Y+1 est.
Y+2 est.
0.00%
Y+3 est.
0.00%
Y+4 est.
0.00%
Y+5 est.
0.00%

Discounted Cash Flow (exit mult.)

Forecast years: 5 Years
Exit FCF Multiple
LowMidHigh
Discount Rate
Free cash flow estimates:
Y+1 est.
Y+2 est.
0.00%
Y+3 est.
0.00%
Y+4 est.
0.00%
Y+5 est.
0.00%

Dividend Discount Model

Annual Dividend
First Stage Length (Years): 0 Years
First Stage Growth Rate
Final Growth Rate
Discount Rate

EPS Growth

Forecast years: 5 Years
Starting EPS
EPS Growth Rate
LowMidHigh
Final P/E
LowMidHigh
Discount Rate

Revenue Growth Valuation

Forecast Years: 10 Years
Base Revenue
Revenue Growth Rate
LowMidHigh
Final Net Margin
LowMidHigh
Final P/E Ratio
LowMidHigh
Discount Rate

Peter Lynch Fair Value

Earnings Per Share
Growth Rate

Graham Formula

Earnings Per Share
EPS Growth (7-10 years)
Government Bond Rate