Cadence Design Systems (cdns) Stock Moves -0.48%: What You Should Know

Cadence Design Systems (CDNS) closed the latest trading day at $253.88, indicating a -0.48% change from the previous session's end. The stock exceeded the S&P 500, which registered a loss of 1.07% for the day. On the other hand, the Dow registered a loss of 0.62%, and the technology-centric Nasdaq decreased by 1.71%.

Shares of the maker of hardware and software products for validating chip designs have depreciated by 13.58% over the course of the past month, underperforming the Computer and Technology sector's loss of 11.12% and the S&P 500's loss of 7.03%.

Market participants will be closely following the financial results of Cadence Design Systems in its upcoming release. The company's earnings per share (EPS) are projected to be $1.49, reflecting a 27.35% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $1.24 billion, showing a 22.76% escalation compared to the year-ago quarter.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $6.71 per share and a revenue of $5.19 billion, signifying shifts of +12.4% and +11.76%, respectively, from the last year.

Investors should also pay attention to any latest changes in analyst estimates for Cadence Design Systems. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 3.7% downward. Currently, Cadence Design Systems is carrying a Zacks Rank of #3 (Hold).

From a valuation perspective, Cadence Design Systems is currently exchanging hands at a Forward P/E ratio of 38.04. For comparison, its industry has an average Forward P/E of 25.46, which means Cadence Design Systems is trading at a premium to the group.

We can additionally observe that CDNS currently boasts a PEG ratio of 2.71. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. By the end of yesterday's trading, the Computer - Software industry had an average PEG ratio of 2.15.

The Computer - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 128, placing it within the top 50% of over 250 industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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