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CDNS 
Cadence Design Systems Inc (CDNS)
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Upturn Advisory Summary
10/23/2025: CDNS (1-star) is currently NOT-A-BUY. Pass it for now.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
Number of Analysts
23 Analysts rated it
Well-followed company, solid analyst reports, reliable data for confident investing.
1 Year Target Price $370.84
1 Year Target Price $370.84
| 14 | Strong Buy |
| 5 | Buy |
| 3 | Hold |
| 0 | Sell |
| 1 | Strong Sell |
Analysis of Past Performance
Type Stock | Historic Profit -8.84% | Avg. Invested days 44 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance  3.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 10/23/2025 |
Key Highlights
Company Size Large-Cap Stock | Market Capitalization 90.06B USD | Price to earnings Ratio 89.33 | 1Y Target Price 370.84 |
Price to earnings Ratio 89.33 | 1Y Target Price 370.84 | ||
Volume (30-day avg) 23 | Beta 0.99 | 52 Weeks Range 221.56 - 376.45 | Updated Date 10/22/2025 |
52 Weeks Range 221.56 - 376.45 | Updated Date 10/22/2025 | ||
Dividends yield (FY) - | Basic EPS (TTM) 3.7 |
Analyzing Revenue: Products, Geography and Growth
Revenue by Products
Product revenue - Year on Year
Revenue by Geography
Geography revenue - Year on Year
Earnings Date
Report Date 2025-10-27 | When - | Estimate 1.79 | Actual - |
Profitability
Profit Margin 19.88% | Operating Margin (TTM) 29.35% |
Management Effectiveness
Return on Assets (TTM) 11.73% | Return on Equity (TTM) 21.84% |
Valuation
Trailing PE 89.33 | Forward PE 44.05 | Enterprise Value 94274810600 | Price to Sales(TTM) 17.7 |
Enterprise Value 94274810600 | Price to Sales(TTM) 17.7 | ||
Enterprise Value to Revenue 18.52 | Enterprise Value to EBITDA 54.27 | Shares Outstanding 272490000 | Shares Floating 271383691 |
Shares Outstanding 272490000 | Shares Floating 271383691 | ||
Percent Insiders 0.3 | Percent Institutions 90.71 |
Upturn AI SWOT
Cadence Design Systems Inc
Company Overview
History and Background
Cadence Design Systems Inc. was founded in 1988 through the merger of ECAD Inc. and SDA Systems. It has grown into a leading provider of electronic design automation (EDA) and intellectual property (IP) solutions. Significant milestones include the development of key EDA tools and strategic acquisitions.
Core Business Areas
- Digital & Signoff: Provides solutions for digital design and signoff verification, crucial for creating complex integrated circuits.
- Custom IC & PCB: Offers solutions for custom integrated circuit and printed circuit board design, essential for analog, mixed-signal, and RF designs.
- IP: Develops and licenses a wide range of intellectual property (IP) cores, including interface, memory, and processor IP.
- System Design & Verification: Delivers system-level design and verification solutions, enabling engineers to create complex electronic systems.
Leadership and Structure
Anirudh Devgan serves as the President and CEO. Cadence Design Systems Inc. has a functional organizational structure with teams focused on R&D, sales, marketing, and customer support.
Top Products and Market Share
Key Offerings
- Virtuoso: A leading custom IC design platform used for analog, mixed-signal, and RF designs. Competitors include Synopsys and Siemens EDA. Market share is estimated to be around 45% in the custom IC design segment.
- Incisive: A functional verification platform used for verifying the correctness of digital designs. Competitors include Synopsys and Siemens EDA. Market share estimated around 35% in the functional verification space.
- Allegro: A PCB design platform for creating complex printed circuit boards. Competitors include Siemens EDA and Altium. Market share is estimated to be around 25% in the PCB design market.
Market Dynamics
Industry Overview
The EDA industry is experiencing growth driven by increasing complexity in chip design, the rise of AI, and increasing demand for specialized chips. The industry is highly competitive, with a few major players dominating the market.
Positioning
Cadence Design Systems Inc. is a leading provider of EDA software, IP, and system design enablement solutions. Its competitive advantages include a comprehensive product portfolio, strong customer relationships, and leading-edge technology.
Total Addressable Market (TAM)
The EDA TAM is expected to reach over $15 billion by 2027. Cadence Design Systems Inc. is well-positioned to capture a significant share of this market, leveraging its broad product portfolio and technological leadership.
Upturn SWOT Analysis
Strengths
- Comprehensive product portfolio
- Strong customer relationships
- Leading-edge technology
- Experienced management team
- Strong financial performance
Weaknesses
- High product prices
- Reliance on semiconductor industry cycles
- Integration complexities across acquired products
- Competition from other EDA vendors
- Customer support responsiveness
Opportunities
- Growth in AI and machine learning
- Expansion into new markets (e.g., automotive)
- Increasing demand for chiplets and advanced packaging
- Partnerships with cloud providers
- Adoption of AI in EDA tools
Threats
- Economic downturn
- Technological disruption
- Increased competition
- Geopolitical risks
- Cybersecurity threats
Competitors and Market Share
Key Competitors
- SNPS
- MENT
Competitive Landscape
Cadence Design Systems Inc. competes with Synopsys and Siemens EDA (formerly Mentor Graphics) in the EDA market. Cadence Design Systems Inc.'s advantages include its comprehensive product portfolio and strong customer relationships. Disadvantages include higher cost than competition in some areas. It is in a very competitive market.
Major Acquisitions
Nubis Communications
- Year: 2020
- Acquisition Price (USD millions): 223
- Strategic Rationale: Expanded Cadence's system analysis capabilities by adding technology for power integrity analysis of electronic systems.
Future Facilities
- Year: 2022
- Acquisition Price (USD millions): 50
- Strategic Rationale: Expanded Cadence's System Analysis business into new adjacent markets with data center infrastructure management (DCIM).
Growth Trajectory and Initiatives
Historical Growth: Cadence Design Systems Inc. has demonstrated consistent revenue and earnings growth over the past several years, driven by demand for its EDA software and IP solutions.
Future Projections: Analysts project continued revenue and earnings growth for Cadence Design Systems Inc., driven by industry trends and strategic initiatives.
Recent Initiatives: Recent initiatives include acquisitions of smaller EDA and IP companies, partnerships with cloud providers, and investments in AI-powered EDA tools.
Summary
Cadence Design Systems Inc. is a strong company in the EDA industry, benefitting from a comprehensive product portfolio and strategic acquisitions. Its consistent revenue and earnings growth reflect the demand for its EDA solutions. Challenges remain in the face of intense competition and economic uncertainties, requiring vigilant management and adaptation to new market trends. The company needs to focus on efficient customer support and product adoption.
Peer Comparison
Sources and Disclaimers
Data Sources:
- Company filings (SEC)
- Analyst reports
- Industry publications
- Company website
Disclaimers:
The information provided is for informational purposes only and should not be considered financial advice. Market conditions and company performance may change, affecting the accuracy of this analysis.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Cadence Design Systems Inc
Exchange NASDAQ | Headquaters San Jose, CA, United States | ||
IPO Launch date 1987-06-10 | CEO, President & Director Dr. Anirudh Devgan Ph.D. | ||
Sector Technology | Industry Software - Application | Full time employees 13152 | Website https://www.cadence.com |
Full time employees 13152 | Website https://www.cadence.com | ||
Cadence Design Systems, Inc. provides software, hardware, and other services worldwide. The company offers functional verification services, such as Jasper, a formal verification platform; Xcelium, a parallel logic simulation platform; Palladium, an enterprise emulation platform; and Protium, a prototyping platform for chip verification. It also provides digital IC design and sign off products, including Genus synthesis and Joules RTL power solutions, as well as Modus DFT software solution to reduce systems-on-chip design-for-test time; physical implementation tools, such as place and route, optimization, and performing sign-off checks for manufacturing; and Innovus implementation system, a digital IC design and signoff solution. In addition, the company offers custom IC design and simulation, such as Virtuoso Studio, a solution platform for custom, analog, mixed-signal, photonics, and RF semiconductors; and system design and analysis products, a Multiphysics platform that helps in design and simulate electronics and entire systems in electromagnetic, thermal, structure, computational fluid dynamics, molecular, PCB and packaging, mechanical, and structural analysis. Further, it provides semiconductor IP product for design architectures; Functional Verification; digital ic design and signoff; EDA product that addresses the design and verification for semiconductor chips and manufacturing process technologies; and verification IP with memory models to emulate and model the expected behavior and interaction of standard industry system interface protocols. Additionally, it offers services related to methodology, education, and hosted design solutions, as well as technical support and maintenance services. It serves consumer, hyperscale computing, 5G communications, mobile, automotive, aerospace and defense, industrial, and life science industries. Cadence Design Systems, Inc. was incorporated in 1987 and is headquartered in San Jose, California.
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