CDNSCDNS
US • —
$375.32
P/E
87.62
PEG
10.31
FCF Yield
—
Rev Growth YoY
+13.4% YoY
Gross Margin
86.1%
Health Score
7/10
D/E Ratio
0.45
Confidence
LOW
Business Snapshot
Cadence Design Systems (CDNS) is a frontrunner in electronic design automation (EDA) software, providing the tools and intellectual property used to design complex semiconductor chips and electronic systems. The company operates in the highly specialized EDA market, holding a strong competitive position as one of the industry's leading players alongside Synopsys. Information on market capitalisation and total revenue is not available in this dataset, making it difficult to confirm its financial scale or exact size tier. A key characteristic that sets Cadence apart is its deeply integrated software suite, which creates significant switching costs for customers and establishes a long-standing partnership with the global semiconductor industry.
Financial Health
Cadence exhibits strong profitability with an industry-leading gross margin of 86.1%, though a comparison to the prior year is unavailable. The net margin of 21.2% indicates solid bottom-line conversion of revenue into profit...
Risk Assessment
- VALUATION — The P/E of 87.62x is massively inflated compared to the sector average of 22x, leaving the stock highly susceptible to multiple compression.
- TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed.
- INSIDER SELLING — 9 insider sells vs 0 buys over the last 90 days signal a cautious internal view of the stock's current valuation.
- FCF / CASH BURN — Free cash flow data is not available, making it impossible to confirm the quality or sustainability of reported earnings.
- EARNINGS QUALITY — Despite beating estimates in 4 of the last 4 quarters, earnings growth of 8.5% significantly lags revenue growth, potentially indicating rising operating costs....
Cadence exhibits strong profitability with an industry-leading gross margin of 86.1%, though a comparison to the prior year is unavailable. The net margin of 21.2% indicates solid bottom-line conversion of revenue into profit. The balance sheet is healthy, marked by a low debt-to-equity ratio of 0.45x and a strong current ratio of 2.86x, signifying robust liquidity and a conservative capital structure. With a return on equity of 21.1%, the company generates substantial returns on shareholder capital. The absence of free cash flow data (FCF) prevents a full assessment of cash generation, but the overall financial profile suggests ample capacity for reinvestment into the business.
- VALUATION — The P/E of 87.62x is massively inflated compared to the sector average of 22x, leaving the stock highly susceptible to multiple compression. - TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed. - INSIDER SELLING — 9 insider sells vs 0 buys over the last 90 days signal a cautious internal view of the stock's current valuation. - FCF / CASH BURN — Free cash flow data is not available, making it impossible to confirm the quality or sustainability of reported earnings. - EARNINGS QUALITY — Despite beating estimates in 4 of the last 4 quarters, earnings growth of 8.5% significantly lags revenue growth, potentially indicating rising operating costs.
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