How Is Cadence Design's Stock Performance Compared to Other Technology Stocks?
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With a market cap of $79.9 billion, Cadence Design Systems, Inc. (CDNS) provides software, hardware, and other services worldwide. Headquartered in San Jose, California, the company offers functional verification services, such as Jasper, a formal verification platform; Xcelium, a parallel logic simulation platform; Palladium, an enterprise emulation platform; and Protium, a prototyping platform for chip verification.
Companies worth $10 billion or more are generally described as "large-cap stocks." CDNS fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size and influence in the Software-Application industry. Cadence maintains strong customer relationships with top semiconductor and electronics firms, reinforcing its position as a trusted, end-to-end design partner in a rapidly evolving tech landscape.
The software giant's stock dropped nearly 10.8% from its 52-week high of $328.99 achieved on Jun. 20 last year. CDNS’ stock has surged 21.3% in the past three months, outperforming the Technology Select Sector SPDR Fund’s (XLK) 8.1% increase.
However, in the longer term, CDNS has declined 2.4% on a YTD basis, whereas XLK rose 1.7%. Moreover, shares of CDNS grew 2.5% over the past 52 weeks, underperforming the XLK's nearly 12.2% rise over the same time frame.
CDNS has traded above its 200-day and 50-day moving averages since late April, indicating a bullish trend.
Shares of CDNS declined 1.3% on the following day after its Q1 earnings release on Apr. 28. The company posted revenue of $1.2 billion, which advanced 23.1% from the prior year’s quarter and met the consensus estimates, primarily driven by broad-based growth across all its reportable segments, supported by sustained customer demand for its products and services. Moreover, its adjusted earnings grew 34.2% year-over-year to $1.57 and surpassed the analyst expectations.
Its rival, ServiceNow, Inc. (NOW), has outperformed the stock over the longer term, surging 53.1% over the past year.
Among the 18 analysts covering the CDNS stock, the consensus rating is a “Strong Buy.” Its mean price target of $327 suggests an 11.5% upside potential from current price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.