Cadence Design Systems (CDNS) ended the recent trading session at $379.06, demonstrating a -2.57% change from the preceding day's closing price. The stock's performance was behind the S&P 500's daily loss of 1.44%. On the other hand, the Dow registered a loss of 0.09%, and the technology-centric Nasdaq decreased by 2.22%.
The maker of hardware and software products for validating chip designs's shares have seen an increase of 4.14% over the last month, surpassing the Computer and Technology sector's gain of 0.98% and the S&P 500's gain of 0.08%.
Market participants will be closely following the financial results of Cadence Design Systems in its upcoming release. The company is forecasted to report an EPS of $2.05, showcasing a 24.24% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $1.58 billion, up 23.58% from the year-ago period.
CDNS's full-year Zacks Consensus Estimates are calling for earnings of $7.94 per share and revenue of $6.2 billion. These results would represent year-over-year changes of +11.2% and +17.11%, respectively.
Any recent changes to analyst estimates for Cadence Design Systems should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
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.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Cadence Design Systems presently features a Zacks Rank of #3 (Hold).
Looking at its valuation, Cadence Design Systems is holding a Forward P/E ratio of 49.01. This indicates a premium in contrast to its industry's Forward P/E of 14.35.
One should further note that CDNS currently holds a PEG ratio of 3.61. 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 average PEG ratio for the Computer - Software industry stood at 1.28 at the close of the market yesterday.
The Computer - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 104, this industry ranks in the top 43% of all industries, numbering over 250.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Cadence Design Systems, Inc. (CDNS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).