Cadence Design Systems (CDNS) ended the recent trading session at $313.84, demonstrating a +2.23% change from the preceding day's closing price. The stock outpaced the S&P 500's daily gain of 1.16%. Meanwhile, the Dow gained 1.21%, and the Nasdaq, a tech-heavy index, added 1.18%.
The stock of maker of hardware and software products for validating chip designs has fallen by 3.13% in the past month, lagging the Computer and Technology sector's loss of 1.07% and the S&P 500's loss of 0.42%.
The upcoming earnings release of Cadence Design Systems will be of great interest to investors. The company's earnings report is expected on February 17, 2026. The company is predicted to post an EPS of $1.9, indicating a 1.06% growth compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $1.42 billion, up 5.02% from the year-ago period.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $7.06 per share and a revenue of $5.28 billion, signifying shifts of +18.26% and 0%, respectively, from the last year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Cadence Design Systems. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
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 last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. As of now, Cadence Design Systems holds a Zacks Rank of #3 (Hold).
Investors should also note Cadence Design Systems's current valuation metrics, including its Forward P/E ratio of 38.34. This denotes a premium relative to the industry average Forward P/E of 21.56.
Meanwhile, CDNS's PEG ratio is currently 2.79. 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. The average PEG ratio for the Computer - Software industry stood at 1.67 at the close of the market yesterday.
The Computer - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 82, finds itself in the top 34% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Cadence Design Systems, Inc. (CDNS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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