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In the latest market close, Cadence Design Systems (CDNS) reached $301.86, with a -1.04% movement compared to the previous day. The stock outperformed the S&P 500, which registered a daily loss of 1.07%. At the same time, the Dow lost 0.97%, and the tech-heavy Nasdaq lost 1.19%.
The maker of hardware and software products for validating chip designs's stock has dropped by 0.58% in the past month, falling short of the Computer and Technology sector's gain of 4.8% and the S&P 500's loss of 0.36%.
Investors will be eagerly watching for the performance of Cadence Design Systems in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.82, marking a 31.88% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $1.35 billion, showing a 26.13% escalation compared to the year-ago quarter.
CDNS's full-year Zacks Consensus Estimates are calling for earnings of $5.91 per share and revenue of $4.63 billion. These results would represent year-over-year changes of +14.76% and +13.28%, respectively.
Any recent changes to analyst estimates for Cadence Design Systems should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Cadence Design Systems is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, Cadence Design Systems is holding a Forward P/E ratio of 51.57. This denotes a premium relative to the industry's average Forward P/E of 32.44.
We can also see that CDNS currently has a PEG ratio of 3.32. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Computer - Software industry had an average PEG ratio of 2.3 as trading concluded yesterday.
The Computer - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 56, finds itself in the top 23% echelons of all 250+ industries.