CADENCE DESIGN SYS INC (1CDNS.MI) Stock Fundamental Analysis
BIT:1CDNS - Euronext Milan - US1273871087 - Common Stock - Currency: EUR
Overall 1CDNS gets a fundamental rating of 6 out of 10. We evaluated 1CDNS against 104 industry peers in the Software industry. 1CDNS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 1CDNS is valued quite expensively, but it does show have an excellent growth rating. These ratings would make 1CDNS suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
1CDNS had positive earnings in the past year.
In the past year 1CDNS had a positive cash flow from operations.
1CDNS had positive earnings in each of the past 5 years.
Each year in the past 5 years 1CDNS had a positive operating cash flow.
1.2 Ratios
1CDNS has a Return On Assets of 10.64%. This is amongst the best in the industry. 1CDNS outperforms 90.29% of its industry peers.
1CDNS's Return On Equity of 20.21% is amongst the best of the industry. 1CDNS outperforms 84.47% of its industry peers.
Looking at the Return On Invested Capital, with a value of 15.31%, 1CDNS belongs to the top of the industry, outperforming 89.32% of the companies in the same industry.
1CDNS had an Average Return On Invested Capital over the past 3 years of 20.16%. This is significantly above the industry average of 11.25%.
The 3 year average ROIC (20.16%) for 1CDNS is well above the current ROIC(15.31%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.64% | ||
| ROE | 20.21% | ||
| ROIC | 15.31% |
ROA(3y)15.55%
ROA(5y)15.49%
ROE(3y)28.03%
ROE(5y)26.64%
ROIC(3y)20.16%
ROIC(5y)18.92%
1.3 Margins
The Profit Margin of 1CDNS (19.88%) is better than 84.47% of its industry peers.
In the last couple of years the Profit Margin of 1CDNS has declined.
1CDNS has a Operating Margin of 30.74%. This is amongst the best in the industry. 1CDNS outperforms 90.29% of its industry peers.
1CDNS's Operating Margin has improved in the last couple of years.
The Gross Margin of 1CDNS (85.57%) is better than 84.47% of its industry peers.
In the last couple of years the Gross Margin of 1CDNS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.74% | ||
| PM (TTM) | 19.88% | ||
| GM | 85.57% |
OM growth 3Y4.75%
OM growth 5Y6.92%
PM growth 3Y-0.79%
PM growth 5Y-11.69%
GM growth 3Y-1.39%
GM growth 5Y-0.58%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 1CDNS is creating value.
Compared to 1 year ago, 1CDNS has more shares outstanding
1CDNS has less shares outstanding than it did 5 years ago.
1CDNS has a worse debt/assets ratio than last year.
2.2 Solvency
1CDNS has a debt to FCF ratio of 1.56. This is a very positive value and a sign of high solvency as it would only need 1.56 years to pay back of all of its debts.
The Debt to FCF ratio of 1CDNS (1.56) is better than 72.82% of its industry peers.
A Debt/Equity ratio of 0.49 indicates that 1CDNS is not too dependend on debt financing.
The Debt to Equity ratio of 1CDNS (0.49) is worse than 62.14% of its industry peers.
Even though the debt/equity ratio score it not favorable for 1CDNS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 1.56 | ||
| Altman-Z | N/A |
ROIC/WACC1.45
WACC10.59%
2.3 Liquidity
A Current Ratio of 2.82 indicates that 1CDNS has no problem at all paying its short term obligations.
The Current ratio of 1CDNS (2.82) is better than 86.41% of its industry peers.
A Quick Ratio of 2.67 indicates that 1CDNS has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.67, 1CDNS belongs to the top of the industry, outperforming 82.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.82 | ||
| Quick Ratio | 2.67 |
3. Growth
3.1 Past
1CDNS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 32.42%, which is quite impressive.
Measured over the past years, 1CDNS shows a very strong growth in Earnings Per Share. The EPS has been growing by 22.21% on average per year.
1CDNS shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.29%.
The Revenue has been growing by 14.72% on average over the past years. This is quite good.
EPS 1Y (TTM)32.42%
EPS 3Y21.73%
EPS 5Y22.21%
EPS Q2Q%28.91%
Revenue 1Y (TTM)22.29%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%20.25%
3.2 Future
Based on estimates for the next years, 1CDNS will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.75% on average per year.
Based on estimates for the next years, 1CDNS will show a quite strong growth in Revenue. The Revenue will grow by 9.79% on average per year.
EPS Next Y16.01%
EPS Next 2Y15.27%
EPS Next 3Y15.05%
EPS Next 5Y10.75%
Revenue Next Year12.12%
Revenue Next 2Y12.12%
Revenue Next 3Y12.02%
Revenue Next 5Y9.79%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 53.21 indicates a quite expensive valuation of 1CDNS.
The rest of the industry has a similar Price/Earnings ratio as 1CDNS.
The average S&P500 Price/Earnings ratio is at 26.48. 1CDNS is valued rather expensively when compared to this.
With a Price/Forward Earnings ratio of 45.24, 1CDNS can be considered very expensive at the moment.
1CDNS's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 34.04. 1CDNS is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.21 | ||
| Fwd PE | 45.24 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1CDNS is valued a bit more expensive than the industry average as 60.19% of the companies are valued more cheaply.
The rest of the industry has a similar Price/Free Cash Flow ratio as 1CDNS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.82 | ||
| EV/EBITDA | 54.83 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1CDNS does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of 1CDNS may justify a higher PE ratio.
1CDNS's earnings are expected to grow with 15.05% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.32
PEG (5Y)2.4
EPS Next 2Y15.27%
EPS Next 3Y15.05%
5. Dividend
5.1 Amount
No dividends for 1CDNS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
BIT:1CDNS (8/1/2025, 7:00:00 PM)
308.1
+36.9 (+13.61%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners91.41%
Inst Owner ChangeN/A
Ins Owners0.27%
Ins Owner ChangeN/A
Market Cap84.12B
Analysts78.62
Price TargetN/A
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.64%
Min EPS beat(2)3.21%
Max EPS beat(2)4.06%
EPS beat(4)4
Avg EPS beat(4)5.03%
Min EPS beat(4)1.28%
Max EPS beat(4)11.57%
EPS beat(8)8
Avg EPS beat(8)3.59%
EPS beat(12)12
Avg EPS beat(12)3.36%
EPS beat(16)16
Avg EPS beat(16)4.59%
Revenue beat(2)1
Avg Revenue beat(2)-0.84%
Min Revenue beat(2)-1.71%
Max Revenue beat(2)0.03%
Revenue beat(4)2
Avg Revenue beat(4)-0.51%
Min Revenue beat(4)-1.71%
Max Revenue beat(4)0.87%
Revenue beat(8)3
Avg Revenue beat(8)-0.58%
Revenue beat(12)4
Avg Revenue beat(12)-0.49%
Revenue beat(16)7
Avg Revenue beat(16)-0.18%
PT rev (1m)N/A
PT rev (3m)N/A
EPS NQ rev (1m)3.06%
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)N/A
Revenue NQ rev (1m)0.82%
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)N/A
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.21 | ||
| Fwd PE | 45.24 | ||
| P/S | 19.25 | ||
| P/FCF | 61.82 | ||
| P/OCF | 57.1 | ||
| P/B | 19.57 | ||
| P/tB | 54.81 | ||
| EV/EBITDA | 54.83 |
EPS(TTM)5.79
EY1.88%
EPS(NY)6.81
Fwd EY2.21%
FCF(TTM)4.98
FCFY1.62%
OCF(TTM)5.4
OCFY1.75%
SpS16
BVpS15.74
TBVpS5.62
PEG (NY)3.32
PEG (5Y)2.4
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.64% | ||
| ROE | 20.21% | ||
| ROCE | 19.53% | ||
| ROIC | 15.31% | ||
| ROICexc | 23.64% | ||
| ROICexgc | 62.26% | ||
| OM | 30.74% | ||
| PM (TTM) | 19.88% | ||
| GM | 85.57% | ||
| FCFM | 31.15% |
ROA(3y)15.55%
ROA(5y)15.49%
ROE(3y)28.03%
ROE(5y)26.64%
ROIC(3y)20.16%
ROIC(5y)18.92%
ROICexc(3y)28.2%
ROICexc(5y)26.78%
ROICexgc(3y)72.83%
ROICexgc(5y)62.51%
ROCE(3y)25.95%
ROCE(5y)24.28%
ROICexcg growth 3Y4.04%
ROICexcg growth 5Y11.48%
ROICexc growth 3Y-4.84%
ROICexc growth 5Y2.66%
OM growth 3Y4.75%
OM growth 5Y6.92%
PM growth 3Y-0.79%
PM growth 5Y-11.69%
GM growth 3Y-1.39%
GM growth 5Y-0.58%
F-Score5
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 1.56 | ||
| Debt/EBITDA | 1.39 | ||
| Cap/Depr | 60.51% | ||
| Cap/Sales | 2.57% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 96.36% | ||
| Profit Quality | 156.64% | ||
| Current Ratio | 2.82 | ||
| Quick Ratio | 2.67 | ||
| Altman-Z | N/A |
F-Score5
WACC10.59%
ROIC/WACC1.45
Cap/Depr(3y)78.99%
Cap/Depr(5y)69.81%
Cap/Sales(3y)3.02%
Cap/Sales(5y)2.97%
Profit Quality(3y)119.11%
Profit Quality(5y)128.61%
High Growth Momentum
Growth
EPS 1Y (TTM)32.42%
EPS 3Y21.73%
EPS 5Y22.21%
EPS Q2Q%28.91%
EPS Next Y16.01%
EPS Next 2Y15.27%
EPS Next 3Y15.05%
EPS Next 5Y10.75%
Revenue 1Y (TTM)22.29%
Revenue growth 3Y15.81%
Revenue growth 5Y14.72%
Sales Q2Q%20.25%
Revenue Next Year12.12%
Revenue Next 2Y12.12%
Revenue Next 3Y12.02%
Revenue Next 5Y9.79%
EBIT growth 1Y30.05%
EBIT growth 3Y21.31%
EBIT growth 5Y22.65%
EBIT Next Year25.06%
EBIT Next 3Y17.9%
EBIT Next 5Y9.92%
FCF growth 1Y39.78%
FCF growth 3Y2.64%
FCF growth 5Y11.29%
OCF growth 1Y35.98%
OCF growth 3Y4.62%
OCF growth 5Y11.56%