Cadence Design Systems (NASDAQ:CDNS) Stock Price Expected to Rise, JPMorgan Chase & Co. Analyst Says

Key Points

• JPMorgan raised Cadence Design Systems’ price target to $420 from $405 and maintained an “overweight” rating, implying 21.5% upside. The analyst consensus remains favorable, with an average “Moderate Buy” rating and $406.78 target.
• Cadence shares rose 7.3% to $345.69 after the company reported quarterly revenue of $1.63 billion and earnings of $2.11 per share, beating analyst estimates. Revenue increased 22% year over year.
• Investor sentiment is supported by strong AI-related demand, an approximately $8.2 billion backlog and raised full-year growth guidance, though the stock’s high valuation and potential margin pressure remain risks.

Cadence Design Systems (NASDAQ:CDNS - Get Free Report) had its target price lifted by equities researchers at JPMorgan Chase & Co. from $405.00 to $420.00 in a research report issued on Tuesday, Benzinga reports. The brokerage currently has an "overweight" rating on the software maker's stock. JPMorgan Chase & Co.'s price objective suggests a potential upside of 21.50% from the stock's current price.

Several other brokerages also recently issued reports on CDNS. Citigroup raised their price objective on shares of Cadence Design Systems from $400.00 to $420.00 and gave the stock a "buy" rating in a research note on Tuesday, July 28th. FBN Securities started coverage on Cadence Design Systems in a report on Friday, September 11th. They issued an "outperform" rating and a $375.00 price target on the stock. KeyCorp reissued an "overweight" rating on shares of Cadence Design Systems in a research note on Tuesday. Bank of America boosted their price objective on Cadence Design Systems from $400.00 to $420.00 and gave the company a "buy" rating in a report on Tuesday, July 28th. Finally, Oppenheimer reaffirmed a "market perform" rating and issued a $300.00 price objective (up from $275.00) on shares of Cadence Design Systems in a research report on Tuesday, July 28th. One investment 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 presently has an average rating of "Moderate Buy" and an average target price of $406.78.

Cadence Design Systems Trading Up 7.3%

NASDAQ CDNS traded up $23.52 on Tuesday, hitting $345.69. 3,218,053 shares of the stock were exchanged, compared to its average volume of 2,455,066. 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 stock has a fifty day moving average price of $318.83 and a two-hundred day moving average price of $326.92. The firm has a market capitalization of $95.20 billion, a P/E ratio of 68.49, a P/E/G ratio of 3.38 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.

Cadence Design Systems (NASDAQ:CDNS - Get Free Report) last announced its earnings results on Monday, October 26th. The software maker reported $2.11 earnings per share for the quarter, beating the consensus estimate of $2.05 by $0.06. The business had revenue of $1.63 billion for the quarter, compared to the consensus estimate of $1.61 billion. Cadence Design Systems had a net margin of 23.60% and a return on equity of 27.98%. The business's revenue for the quarter was up 22.0% on a year-over-year basis. During the same quarter in the prior year, the firm posted $1.93 earnings per share. Research analysts forecast that Cadence Design Systems will post 6.42 EPS for the current fiscal year.

Insider Activity at Cadence Design Systems

In other news, Director Ita M. Brennan sold 180 shares of Cadence Design Systems stock in a transaction that occurred on Thursday, September 10th. The shares were sold at an average price of $285.51, for a total transaction of $51,391.80. Following the completion of 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 ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Albert Sangiovanni-Vincentelli sold 1,250 shares of the business's stock in a transaction that occurred on Thursday, October 1st. The shares were sold at an average price of $350.07, for a total value of $437,587.50. Following the completion of the sale, the director owned 39,544 shares of the company's stock, valued at $13,843,168.08. The trade was a 3.06% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 8,960 shares of company stock valued at $2,834,139 over the last 90 days. 0.49% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Cadence Design Systems

A number of institutional investors and hedge funds have recently bought and sold shares of the company. George Kaiser Family Foundation purchased a new stake in shares of Cadence Design Systems during the 2nd quarter worth $725,000. Vega Investment Solutions bought a new stake in Cadence Design Systems during the second quarter valued at about $1,957,000. MassMutual Private Wealth & Trust FSB grew its stake in Cadence Design Systems by 65.7% in the third quarter. MassMutual Private Wealth & Trust FSB now owns 26,160 shares of the software maker's stock valued at $8,638,000 after purchasing an additional 10,376 shares during the last quarter. Park National Corp OH grew its stake in Cadence Design Systems by 186.9% in the third quarter. Park National Corp OH now owns 372,703 shares of the software maker's stock valued at $123,063,000 after purchasing an additional 242,816 shares during the last quarter. Finally, Osmosis Investment Management UK Ltd bought a new position in Cadence Design Systems in the second quarter worth about $5,238,000. 84.85% of the stock is owned by institutional investors.

Key Headlines Impacting Cadence Design Systems

Here are the key news stories impacting Cadence Design Systems this week:

• Positive Sentiment: Cadence reported third-quarter revenue of $1.63 billion, up 22% year over year and above the $1.61 billion consensus estimate. Adjusted earnings of $2.11 per share also exceeded expectations of approximately $2.05, supporting the stock’s upward move. Cadence Q3 Earnings Beat Estimates on AI Demand, Outlook Raised
• Positive Sentiment: Management raised its full-year 2026 outlook, with revenue growth guidance lifted to about 21%. Record backlog of approximately $8.2 billion indicates strong forward demand from semiconductor and systems customers. Cadence increases full-year fiscal 2026 guidance
• Positive Sentiment: Analysts highlighted the early-stage opportunity in “agentic AI” and accelerating AI adoption across chip-design workflows. Cadence also introduced its Maestro AI model portfolio for AI super agents, reinforcing its positioning in the semiconductor AI infrastructure cycle. Cadence introduces Maestro AI model portfolio
• Positive Sentiment: JPMorgan raised its price target to $420 from $405, while Needham lifted its target to $430 and Baird to $440; the firms maintained constructive ratings. JPMorgan raises Cadence price target
• Neutral Sentiment: Cadence expanded its share-repurchase authorization by $2.5 billion, which could provide longer-term support for per-share results but does not immediately change operating performance. Cadence expands share repurchase authorization
• Negative Sentiment: Investors should monitor valuation and execution risks: the stock trades at a high earnings multiple, while commentary indicated some margin pressure. Unusually elevated put-option activity also signals increased near-term hedging or bearish speculation.

Cadence Design Systems Company Profile

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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