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Cadence Design Systems (CDNS) closed the most recent trading day at $324.52, moving +0.94% from the previous trading session. The stock outperformed the S&P 500, which registered a daily gain of 0.53%. On the other hand, the Dow registered a gain of 0.93%, and the technology-centric Nasdaq increased by 0.22%.
The the stock of maker of hardware and software products for validating chip designs has risen by 4.18% in the past month, leading the Computer and Technology sector's gain of 3.02% and the S&P 500's gain of 2.69%.
The investment community will be paying close attention to the earnings performance of Cadence Design Systems in its upcoming release. The company is slated to reveal its earnings on February 18, 2025. The company is expected to report EPS of $1.82, up 31.88% from the prior-year quarter. Alongside, our most recent consensus estimate is anticipating revenue of $1.35 billion, indicating a 26.13% upward movement from the same quarter last year.
Investors might also notice recent changes to analyst estimates for Cadence Design Systems. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Currently, Cadence Design Systems is carrying a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Cadence Design Systems has a Forward P/E ratio of 47.04 right now. For comparison, its industry has an average Forward P/E of 31.4, which means Cadence Design Systems is trading at a premium to the group.
We can additionally observe that CDNS currently boasts a PEG ratio of 3.03. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. By the end of yesterday's trading, the Computer - Software industry had an average PEG ratio of 2.46.
The Computer - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 165, positioning it in the bottom 35% of all 250+ industries.