Cadence Design Systems (NASDAQ:CDNS) Cut to Hold at Wall Street Zen

Key Points

• Wall Street Zen downgraded Cadence Design Systems to “hold” from “buy,” though broader analyst sentiment remains “Moderate Buy,” with 18 buys, one strong buy and three holds, and an average price target of $404.14.
• Cadence shares opened at $325.86, up 2%, while trading below their 200-day moving average and well below the 52-week high of $416.69.
• The company exceeded quarterly earnings expectations with EPS of $2.11 versus $2.05 expected, while revenue rose 24.2% year over year to $1.58 billion; insiders have sold $2.83 million of stock over the past 90 days.

Cadence Design Systems (NASDAQ:CDNS - Get Free Report) was downgraded by analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a note issued to investors on Tuesday, Wall Street Zen reports.

A number of other brokerages also recently weighed in on CDNS. Benchmark reiterated a "buy" rating on shares of Cadence Design Systems in a report on Tuesday, July 28th. Needham & Company LLC reiterated a "buy" rating and issued a $400.00 target price on shares of Cadence Design Systems in a report on Tuesday, July 28th. Oppenheimer reiterated a "market perform" rating and issued a $300.00 target price (up from $275.00) on shares of Cadence Design Systems in a report on Tuesday, July 28th. FBN Securities initiated coverage on shares of Cadence Design Systems in a research report on Friday, September 11th. They issued an "outperform" rating and a $375.00 price target for the company. Finally, KeyCorp restated an "overweight" rating on shares of Cadence Design Systems in a report on Tuesday, July 28th. One equities research analyst has rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and three have issued a Hold rating to the company's stock. According to data from MarketBeat.com, the company currently has an average rating of "Moderate Buy" and an average price target of $404.14.

Cadence Design Systems Stock Up 2.0%

Shares of NASDAQ:CDNS opened at $325.86 on Tuesday. The company has a debt-to-equity ratio of 0.36, a quick ratio of 1.53 and a current ratio of 1.74. The company has a market cap of $89.74 billion, a PE ratio of 51.87, a price-to-earnings-growth ratio of 3.42 and a beta of 1.13. Cadence Design Systems has a 52 week low of $262.75 and a 52 week high of $416.69. The firm has a 50 day simple moving average of $318.73 and a 200 day simple moving average of $339.65.

Cadence Design Systems (NASDAQ:CDNS - Get Free Report) last posted its quarterly earnings data on Monday, July 27th. The software maker reported $2.11 earnings per share for the quarter, topping the consensus estimate of $2.05 by $0.06. Cadence Design Systems had a net margin of 23.60% and a return on equity of 27.98%. The firm had revenue of $1.58 billion for the quarter, compared to analysts' expectations of $1.58 billion. During the same period in the previous year, the company posted $1.65 EPS. The company's quarterly revenue was up 24.2% compared to the same quarter last year. Cadence Design Systems has set its FY 2026 guidance at 8.050-8.150 EPS and its Q3 2026 guidance at 2.010-2.070 EPS. As a group, research analysts expect that Cadence Design Systems will post 6.41 earnings per share for the current year.

Insider Activity

In other Cadence Design Systems news, Director Albert Sangiovanni-Vincentelli sold 1,250 shares of the company's stock in a transaction dated Thursday, October 1st. The shares were sold at an average price of $350.07, for a total transaction of $437,587.50. Following the completion of the sale, the director directly owned 39,544 shares in the company, valued at $13,843,168.08. This represents a 3.06% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Ita Brennan sold 180 shares of the stock in a transaction that occurred on Thursday, September 10th. The shares were sold at an average price of $285.51, for a total value of $51,391.80. Following the sale, the director owned 7,824 shares of the company's stock, valued at approximately $2,233,830.24. The trade was a 2.25% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 8,960 shares of company stock worth $2,834,139 in the last 90 days. Insiders own 0.49% of the company's stock.

Institutional Trading of Cadence Design Systems

A number of hedge funds have recently modified their holdings of CDNS. Whipplewood Advisors LLC boosted its stake in Cadence Design Systems by 933.3% in the 1st quarter. Whipplewood Advisors LLC now owns 93 shares of the software maker's stock worth $26,000 after purchasing an additional 84 shares during the period. Brown Lisle Cummings Inc. boosted its position in shares of Cadence Design Systems by 860.0% during the first quarter. Brown Lisle Cummings Inc. now owns 96 shares of the software maker's stock worth $27,000 after buying an additional 86 shares during the period. Avalon Trust Co acquired a new position in shares of Cadence Design Systems during the second quarter worth about $30,000. Burkett Financial Services LLC acquired a new position in shares of Cadence Design Systems during the third quarter worth about $30,000. Finally, Fiduciary Financial Advisors bought a new position in shares of Cadence Design Systems during the second quarter worth about $31,000. Institutional investors own 84.85% of the company's stock.

About Cadence Design Systems

Cadence Design Systems, Inc develops computational software, hardware, and semiconductor intellectual property used to design and verify electronic systems and integrated circuits. Its electronic design automation (EDA) solutions support chip development across areas such as digital and custom IC design, functional verification, emulation, prototyping, and system analysis.

The company also provides semiconductor IP, including processor cores, interconnect technologies, memory interfaces, and other building blocks that help customers develop complex chips.

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