Cadence Design Systems (NASDAQ: CDNS) is one of 118 publicly-traded companies in the “Software” industry, but how does it contrast to its peers? We will compare Cadence Design Systems to related companies based on the strength of its profitability, earnings, analyst recommendations, valuation, risk, institutional ownership and dividends.
Risk & Volatility
Cadence Design Systems has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Cadence Design Systems’ peers have a beta of 0.98, indicating that their average stock price is 2% less volatile than the S&P 500.
Valuation & Earnings
This table compares Cadence Design Systems and its peers revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Cadence Design Systems||$1.87 billion||$421.11 million||48.03|
|Cadence Design Systems Competitors||$1.52 billion||$446.91 million||39.53|
Cadence Design Systems has higher revenue, but lower earnings than its peers. Cadence Design Systems is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
This table compares Cadence Design Systems and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cadence Design Systems||14.43%||30.94%||12.44%|
|Cadence Design Systems Competitors||-43.37%||-25.08%||-9.88%|
This is a breakdown of recent recommendations and price targets for Cadence Design Systems and its peers, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cadence Design Systems||1||1||3||0||2.40|
|Cadence Design Systems Competitors||264||2008||4267||84||2.63|
Cadence Design Systems currently has a consensus target price of $34.00, indicating a potential downside of 18.64%. As a group, “Software” companies have a potential upside of 3.89%. Given Cadence Design Systems’ peers stronger consensus rating and higher possible upside, analysts clearly believe Cadence Design Systems has less favorable growth aspects than its peers.
Institutional and Insider Ownership
84.2% of Cadence Design Systems shares are owned by institutional investors. Comparatively, 58.4% of shares of all “Software” companies are owned by institutional investors. 2.6% of Cadence Design Systems shares are owned by insiders. Comparatively, 20.0% of shares of all “Software” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Cadence Design Systems peers beat Cadence Design Systems on 7 of the 13 factors compared.
About Cadence Design Systems
Cadence Design Systems, Inc. provides solutions that enable its customers to design electronic products. The Company’s product categories include Functional Verification, Digital integrated circuits (IC) Design and Signoff, Custom IC Design and Verification, System Interconnect and Analysis, and intellectual property (IP). Functional verification products are used to verify that the circuitry or the software designed will perform as intended. Digital IC design offerings are used to create representations of a digital circuit or an IC that can be verified for correctness prior to implementation. Custom IC design and verification offerings are used to create schematic and physical representations of circuits down to the transistor level for analog and memory designs. System Interconnect and Analysis offerings are used to develop printed circuit boards and IC packages. Design IP offerings consist of functional blocks, which customers integrate into their ICs for the development process.
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