Cadence Design Systems Inc

Technology
Computer Software: Prepackaged Software
www.cadence.com

Earnings Score
Moat Score
Safety Score
Final Score

Market Cap $83.20B
PE 77
Debt $2.48B
Cash $2.78B
EV $82.89B
FCF $1.38B

Earnings

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Sales & Net Margins

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Earnings	$1.08B
EBIT	$1.45B
ROE	23%
ROA	16%
FCF	$1.38B
Equity	$4.78B
Growth Stability	100%
PE	76.93
PEG	8.93
PB	17.42
P/FCF	60.36
P/S	17.07
Price/Cash	0.03
Debt/Equity	0.52
Debt/FCF	1.8
Net Margins	22%
Op. Margins	30%
Earnings CAGR	23%
Sales Growth YoY	23%
Sales Growth QoQ	-8%
Sales CAGR	13%
FCF CAGR	16%
Equity CAGR	18%
Earnings Stability	0.78
Earnings Growth YoY	10%
Earnings Growth QoQ	-20%

Earnings CAGR 5Y	9%
Sales CAGR 5Y	15%
FCF CAGR 5Y	9%
Equity CAGR 5Y	16%
Earnings CAGR 3Y	14%
Sales CAGR 3Y	14%
FCF CAGR 3Y	2%
Equity CAGR 3Y	28%
Market Cap	$83.20B
Revenue	$4.87B
Assets	$9.01B
Total Debt	$2.48B
Cash	$2.78B
Shares Outstanding	270.87M
EV	82.89B
Earnings Score	93%
Moat Score	96%
Safety Score	94%
Final Score	94%
Working Capital	2.7B
Current Ratio	3.07
Shares Growth 3y	-0%
Equity Growth QoQ	2%
Equity Growth YoY	34%

Assets & ROA

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Stockholders Equity & ROE

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Cadence Design Systems is a provider of electronic design automation software, intellectual property, and system design and analysis products. EDA software automates the chip design process, enhancing design accuracy, productivity, and complexity in a full-flow end-to-end solution. Cadence offers a portfolio of design IP, as well as system design and analysis products, which enable system-level analysis and verification solutions. Cadence's comprehensive portfolio is benefiting from a mutual convergence of semiconductor companies moving up-stack toward systems-like companies, and systems companies moving down-stack toward in-house chip design. The resulting expansion in EDA customers, alongside secular digitalization of various end markets, benefits EDA vendors like Cadence.

SEC Filings

Direct access to Cadence Design Systems Inc (CDNS) Annual Reports (10K) and Quarterly Reports (10Q) from the SEC website.

2025
- 10-Q Mar 31
2024
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31
2023
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31

Sector Comparison

How does Cadence Design Systems Inc compare to its competitors?

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Peter Lynch's Chart

This chart shows the current pricing of Cadence Design Systems Inc compared to its past. The addition of the earnings trend line provides further insights into the company's earnings power.

CAGR 23%

Stability 78%

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Cadence Design Systems Inc Discounted Cash Flow

Fully customizable DCF calculator online for Cadence Design Systems Inc.

Years

Calculation mode

= $43B

	0	1	2	3	4	5	6	7	8	9	10	TV
fcf	$1.4B	$1.6B	$1.9B	$2.2B	$2.5B	$3B	$3.4B	$4B	$4.7B	$5.4B	$6.3B	$63B
DCF		$1.5B	$1.5B	$1.6B	$1.7B	$1.8B	$1.9B	$2.1B	$2.2B	$2.3B	$2.4B	$24B
Value	$43B

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

Years	01/2016	12/2016	12/2017	12/2018	12/2019	01/2021	12/2021	12/2022	12/2023	12/2024	TTM
Net Margins	15%	11%	11%	16%	42%	22%	23%	24%	25%	23%	22%
ROA	-	12%	13%	16%	15%	16%	18%	21%	23%	16%	16%
ROE	-	27%	21%	27%	47%	24%	25%	31%	31%	23%	23%

Good Net Margins (22.02%)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Safety and Stability

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Years	01/2016	12/2016	12/2017	12/2018	12/2019	01/2021	12/2021	12/2022	12/2023	12/2024	TTM
Debt over FCF	-	1.65	1.56	0.64	0.53	0.43	0.34	0.58	0.24	2.21	1.8
Debt over Equity	0.25	0.87	0.65	0.27	0.16	0.14	0.13	0.24	0.09	0.53	0.52
Growth Stability	-	-	-	100%	100%	100%	100%	100%	100%	100%	100%

Good Debt/FCF ratio (1.8)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Good Debt/Equity ratio (0.52)

The company is not overleveraged and has a good balance between equity and debt.

Good Graham’s Stability (100%)

The company has a good stability in its earnings, which is a sign of a good competitive advantage.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Years	01/2016	12/2016	12/2017	12/2018	12/2019	01/2021	12/2021	12/2022	12/2023	12/2024	CAGR 5Y
Revenue YoY growth	-	7%	7%	10%	9%	15%	11%	19%	15%	13%	15%
Earnings YoY growth	-	-20%	0%	69%	186%	-40%	18%	22%	23%	1%	9%
Equity YoY growth	-	-46%	33%	30%	63%	19%	10%	0%	24%	37%	16%
FCF YoY growth	-	17%	6%	32%	21%	24%	28%	8%	11%	-10%	9%