Cadence Design Systems, Inc.

Cadence Design Systems, Inc.

CDNS

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Market Cap$103.41B
Close$

Compare to Similar Companies

P/E RatioDividendsReturn on EquityPrice-to-SalesDebt-to-Equity
Cadence Design Systems, Inc.Cadence Design Systems, Inc.87.1-13%20.40.4

Earnings Call Q1 2026

April 27, 2026 - AI Summary

Strong Q1 performance + raised 2026 outlook (growth, profitability, cash): Q1 revenue $1.474B (+19% YoY), 45% non-GAAP operating margin (GAAP 29.3%), record backlog $8B. EPS: GAAP $1.23, non-GAAP $1.96. Operating cash flow $356M. Raises 2026 revenue growth outlook to ~17% YoY and expects Rule of 60 (very strong operating margin vs revenue) for the first time.
2026 and Q2 financial guidance (including cash deployment): Full-year 2026 revenue $6.125B–$6.225B; GAAP op margin 27.5%–28.5%; non-GAAP op margin 43.5%–44.5%; GAAP EPS $4.39–$4.49, non-GAAP EPS $7.85–$7.95; operating cash flow $1.875B–$1.975B. Capital return: expects to use ~50% of free cash flow for share repurchases in 2026 (Q1 already repurchased $200M). Q2 revenue $1.555B–$1.595B with non-GAAP margin 44.5%–45.5%.
Agentic AI is the demand/consumption engine—plus new monetization model: Management emphasized “agentic AI era is here,” with Cadence launching/advancing an end-to-end “agentic full-flow” approach (AgentStack + ChipStack plus new ViraStack (analog/custom) and InnoStack (digital implementation/signoff)). Key investor takeaway: agentic workflows are expected to increase usage of base EDA tools at scale (more exploration/iterations) and also enable new products/categories monetized as subscription + consumption, not just traditional licenses. They also reassured on defensibility: they’re confident in base-tool advantage and believe internal R&D scale limits “AI-written base tools” risk.

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$402.14

Target Price by Analysts

1.4% downsideCadence Design Systems Target Price DetailsTarget Price
$152.63

Current Fair Value

62.6% downside

Overvalued by 62.6% based on the discounted cash flow analysis.

Share Statistics

Market cap$103.41 Billion
Enterprise Value$105.36 Billion
Dividend Yield$- (-)
Earnings per Share$4.09
Beta1.13
Outstanding Shares272,061,000

Return

Return on Equity13.42%ROE
Return on Assets9.68%
Return on Invested Capital14.53%

Valuation & Multiples

P/E Ratio87.11P/E Ratio
PEG383.88PEG
Price to Sales20.4Price to Sales
Price to Book Ratio12.75Price to Book Ratio
Enterprise Value to Revenue19.06
Enterprise Value to EBIT64.72
Enterprise Value to Net Income89
Total Debt to Enterprise0.03
Debt to Equity0.38Debt to Equity

Revenue Sources

No data

Insider Trades

Last Earnings Call

Report Date
April 27, 2026
EPS Estimate
$1.91
Average shareholder expectation
Revenue Estimate
$1.46 B
Average shareholder expectation

Next Earnings Call

Expected Date
July 27, 2026
EPS Estimate
$2.05
Average shareholder expectation
Revenue Estimate
$1.58 B
Average shareholder expectation

Institutional Put/Call Ratio

Market sentiment based on institutional option activity.

Put/Call Ratio1.3317 12.27%
Total Calls2,605,003 80.64%
Total Puts3,468,963 65.39%

Institutional Ownership

Holdings and activity of institutional investors.

Ownership %84.80% 2.21%
Total Invested$64.02B 12.02%
Investors Holding1,439 55.00%

ESG Score

No data

About Cadence Design Systems, Inc.

CEO: Lip-Bu Tan

Relevant Senate Committees

Joint Committee on Taxation

This committee's non-partisan analysis and 'revenue estimates' are crucial for shaping all tax legislation. Its technical expertise directly influences the corporate tax structures and investment incentives that significantly affect Cadence Design Systems' financial performance and strategic planning.

Finance

As the primary committee for taxation and trade, it directly impacts Cadence Design Systems through corporate tax policy, R&D tax credits, and trade regulations (e.g., tariffs, export controls), which affect profitability, investment decisions, and global market access.

Appropriations

This committee directly allocates federal discretionary spending, with subcommittees determining precise funding for defense programs, scientific research, and other government initiatives that often rely on advanced technology and semiconductor design, directly influencing CDNS's potential market and customer funding.

Judiciary

This committee's oversight of antitrust laws and intellectual property (IP) is highly relevant. Antitrust actions can affect major tech companies (CDNS's customers), and IP protection is fundamental to Cadence Design Systems' business model as a software and IP provider.

Armed Services

Cadence Design Systems' EDA software is crucial for designing chips used in advanced defense systems. This committee's authorization of the NDAA and oversight of the Department of Defense directly determines funding for military R&D and procurement, significantly impacting a major customer segment for CDNS.

Select Committee on Intelligence

Cadence Design Systems' EDA software is foundational for advanced technology, including defense and intelligence applications. Members of this committee receive classified briefings on global threats and technological capabilities, which could create significant informational asymmetry regarding strategic technological priorities and supply chain vulnerabilities impacting CDNS's market.

Commerce, Science, and Transportation

This committee has vast jurisdiction over interstate commerce, telecommunications, and 'Big Tech,' including privacy laws, antitrust, and R&D funding (via the 'Science' component). These areas directly affect Cadence Design Systems' customers and the broader technology market in which it operates.

Foreign Relations

Given the critical role of semiconductors and EDA software in national security and geopolitical strategy, this committee's actions on sanctions, export controls, and foreign policy can directly impact Cadence Design Systems' international sales and market access, particularly in strategic regions.