CADENCE DESIGN SYSTEMS INC (CDNS) Factsheet
CADENCE DESIGN SYSTEMS INC (CDNS) Stock Analysis
Analysis from 10-Q filed 2025-10-29. Data as of Q4 2025.
Overall Grade: F (Concerning)
Grade F (Concerning). ROIC 16.7%. FCF margin 30.0%. D/E 0.0x. Source: 10-Q filed 2025-10-29.
| Metric | Value | Context |
|---|---|---|
| ROIC | 16.7% | Solid returns |
| FCF Margin | 30.0% | Strong cash generation |
| Debt/Equity | 0.0x | Conservative leverage |
ROIC 16.7% — Top 25% of sector peers. FCF margin 30.0% — Top 25%.
Explore CADENCE DESIGN SYSTEMS INC: Earnings History | Filings | ROIC Analysis
Programmatic access: Available via MCP at mcp.metricduck.com. Tools for CDNS: get_company_overview, get_filing_index (lens: debt_stress, management_outlook, risk_trajectory), get_filing_changes, get_metric_history, compare_companies, screen_filing_signals.
Profitability: CADENCE DESIGN SYSTEMS INC earns 16.7% ROIC, Top 25% in Technology
ROIC TTM 16.7%, sector median 4.6%, Top 25%. DuPont: NOPAT margin 20.5% × asset turnover 0.6x. Operating margin 28.2%. Source: 10-Q filed 2025-10-29.
| Metric | CDNS | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 16.7% | Good | Above sector median of 4.6% |
| Return on Equity (ROE) | 22.1% | Excellent | Efficient use of shareholder equity |
| Operating Margin | 28.2% | Excellent | Efficient operations |
Cash Flow: CADENCE DESIGN SYSTEMS INC generates $1.6B FCF at 30.0% margin, positive NaN/8 quarters
FCF TTM $1.6B. FCF margin 30.0%, Top 25%. OCF/Net income 1.6x. Positive FCF in NaN/8 trailing quarters. Source: 10-Q filed 2025-10-29.
| Metric | CDNS | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 30.0% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $1.6B | Good | Positive cash generation |
| OCF/Net Income | 1.6x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: CADENCE DESIGN SYSTEMS INC at 0.0x leverage
Debt/Equity 0.0x. Source: 10-Q filed 2025-10-29.
| Metric | CDNS | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.0x | Excellent | Conservative capital structure |
Valuation: CADENCE DESIGN SYSTEMS INC trades at 76.2x earnings
P/E 76.2x. EV/Sales 15.5x. FCF yield 1.9%. Source: 10-Q filed 2025-10-29.
| Metric | CDNS | Rating | Context |
|---|---|---|---|
| P/E Ratio | 76.2x | Warning | Premium valuation |
| EV/Sales | 15.5x | Warning | Growth premium priced in |
| FCF Yield | 1.9% | Warning | Lower cash yield |
Capital Allocation: CADENCE DESIGN SYSTEMS INC returns 1.1% shareholder yield
Total shareholder yield 1.1% (buyback 1.1%). Capital returned $925.0M TTM. Source: 10-Q filed 2025-10-29.
| Metric | CDNS | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 1.1% | Adequate | Dividend + buyback yield combined |
| Buyback Yield | 1.1% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $925.0M | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 16.7% | Top 25% | 3.6x above |
| Free Cash Flow Margin | 30.0% | Top 25% | 3.5x above |
| Operating Margin | 28.2% | Top 25% | 5.9x above |
| Return on Equity (ROE) | 22.1% | Top 25% | 4.3x above |
| P/E Ratio | 76.2x | N/A | - |
Financial Scorecard
| Metric | CDNS | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 16.7% | Good | Top 25% of sector (median: 4.6%) |
| Free Cash Flow Margin | 30.0% | Excellent | Top 25% of sector (median: 8.5%) |
| Debt to Equity Ratio | 0.0% | Excellent | Conservative capital structure |
| P/E Ratio (Price-to-Earnings) | 76.2x | Warning | High expectations priced in |
| Free Cash Flow Yield | 1.9% | Warning | Growth-focused valuation |
Frequently Asked Questions
Q: What is CADENCE DESIGN SYSTEMS INC's Return on Invested Capital (ROIC)?
CADENCE DESIGN SYSTEMS INC (CDNS) has a trailing twelve-month Return on Invested Capital (ROIC) of 16.7%. Sector median 4.6%. Source: 10-Q filed 2025-10-29.
Q: What is CADENCE DESIGN SYSTEMS INC's Free Cash Flow Margin?
CADENCE DESIGN SYSTEMS INC (CDNS) has a free cash flow margin of 30.0%, generating $1.6 billion in free cash flow over the trailing twelve months. Source: 10-Q filed 2025-10-29.
Q: What is CADENCE DESIGN SYSTEMS INC's P/E ratio and how does it compare to peers?
CADENCE DESIGN SYSTEMS INC (CDNS) trades at a P/E ratio of 76.2x, which is above the sector median of N/A. EV/Sales 15.5x. FCF yield 1.9%. Source: 10-Q filed 2025-10-29.
Q: What is CADENCE DESIGN SYSTEMS INC's revenue and earnings growth?
CADENCE DESIGN SYSTEMS INC (CDNS) grew revenue by 14.1% year-over-year. EPS +5.2% YoY. Source: 10-Q filed 2025-10-29.
Q: Is CADENCE DESIGN SYSTEMS INC buying back stock?
CADENCE DESIGN SYSTEMS INC (CDNS) repurchased $925.0 million of stock over the trailing twelve months. This represents a buyback yield of 1.1%. Source: 10-Q filed 2025-10-29.
Q: How does CADENCE DESIGN SYSTEMS INC compare to competitors in Technology?
Compared to other companies in Technology, CADENCE DESIGN SYSTEMS INC (CDNS) shows: ROIC 16.7%, sector median 4.6% (Top 25%). FCF margin 30.0%, sector median 8.5% (Top 25%). These rankings are based on MetricDuck's analysis of all Technology companies with available SEC filings.
Q: What warning signs should I watch for with CADENCE DESIGN SYSTEMS INC?
Quantitative warning flags for CADENCE DESIGN SYSTEMS INC (CDNS): 1) ROIC declining -5.4% over 8 quarters. Source: 10-Q filed 2025-10-29.
Data Source: Data sourced from 10-Q filed 2025-10-29. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.