In This Article:
In the latest market close, Cadence Design Systems (CDNS) reached $304.41, with a +0.98% movement compared to the previous day. The stock exceeded the S&P 500, which registered a gain of 0.73% for the day. At the same time, the Dow added 0.16%, and the tech-heavy Nasdaq gained 0.98%.
Coming into today, shares of the maker of hardware and software products for validating chip designs had lost 3.33% in the past month. In that same time, the Computer and Technology sector gained 3.28%, while the S&P 500 gained 0.34%.
Market participants will be closely following the financial results of Cadence Design Systems in its upcoming release. The company's upcoming EPS is projected at $1.82, signifying a 31.88% increase compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $1.35 billion, indicating a 26.13% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $5.91 per share and a revenue of $4.63 billion, indicating changes of +14.76% and +13.28%, respectively, from the former year.
Investors should also take note of any recent adjustments to analyst estimates for Cadence Design Systems. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Cadence Design Systems is currently a Zacks Rank #3 (Hold).
In terms of valuation, Cadence Design Systems is presently being traded at a Forward P/E ratio of 50.97. Its industry sports an average Forward P/E of 31.48, so one might conclude that Cadence Design Systems is trading at a premium comparatively.
It is also worth noting that CDNS currently has a PEG ratio of 3.28. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Computer - Software industry had an average PEG ratio of 2.32 as trading concluded yesterday.