Cadence Design Systems (NASDAQ:CDNS) Stock Breaks Below Two Hundred Day Moving Average - What's Next?

Key Points

• Cadence shares fell below their 200-day moving average of $327.36, reaching an intraday low of $309.98 before last trading at $323.75.
• Analyst sentiment remains positive: the consensus rating is Moderate Buy, with a $410.05 average price target; 19 analysts rate the stock Buy or Strong Buy and three rate it Hold.
• In its latest quarter, Cadence reported EPS of $2.11 and revenue of $1.63 billion, beating consensus estimates; revenue increased 22% year over year.

Cadence Design Systems, Inc. (NASDAQ:CDNS - Get Free Report)'s stock price passed below its 200-day moving average during trading on Tuesday. The stock has a 200-day moving average of $327.36 and traded as low as $309.98. Cadence Design Systems shares last traded at $323.75, with a volume of 2,335,475 shares changing hands.

Analyst Upgrades and Downgrades

CDNS has been the topic of a number of analyst reports. Morgan Stanley reaffirmed an "overweight" rating and issued a $400.00 price objective (up from $370.00) on shares of Cadence Design Systems in a research report on Wednesday, July 29th. Mizuho set a $400.00 target price on shares of Cadence Design Systems in a research report on Tuesday, October 27th. KeyCorp restated an "overweight" rating on shares of Cadence Design Systems in a research note on Tuesday, October 27th. Citigroup lifted their price target on shares of Cadence Design Systems from $400.00 to $420.00 and gave the stock a "buy" rating in a report on Tuesday, July 28th. Finally, Needham & Company LLC lifted their price target on shares of Cadence Design Systems from $400.00 to $430.00 and gave the stock a "buy" rating in a report on Tuesday, October 27th. One research analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and three have assigned a Hold rating to the company. According to data from MarketBeat.com, Cadence Design Systems has a consensus rating of "Moderate Buy" and a consensus price target of $410.05.

Cadence Design Systems Price Performance

The firm has a market cap of $88.83 billion, a PE ratio of 64.36, a price-to-earnings-growth ratio of 3.12 and a beta of 1.10. The company has a quick ratio of 1.18, a current ratio of 1.36 and a debt-to-equity ratio of 0.29. The stock has a 50 day moving average price of $320.90 and a two-hundred day moving average price of $327.36.

Cadence Design Systems (NASDAQ:CDNS - Get Free Report) last posted its quarterly earnings data on Monday, October 26th. The software maker reported $2.11 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.05 by $0.06. The firm 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 22.51% and a return on equity of 26.56%. The company's revenue for the quarter was up 22.0% compared to the same quarter last year. During the same quarter in the prior year, the company posted $1.93 earnings per share. As a group, equities analysts expect that Cadence Design Systems, Inc. will post 6.71 earnings per share for the current year.

Insider Buying and Selling at Cadence Design Systems

In other news, Director Ita M. Brennan sold 180 shares of the firm's stock in a transaction dated Thursday, September 10th. The stock was sold at an average price of $285.51, for a total transaction of $51,391.80. Following the sale, the director directly owned 7,824 shares in the company, valued at $2,233,830.24. This trade represents a 2.25% decrease in their position. 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 Albert Sangiovanni-Vincentelli sold 1,250 shares of the business's stock in a transaction on Thursday, October 1st. The stock was 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 of the company's stock, valued at approximately $13,843,168.08. The trade was a 3.06% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 8,960 shares of company stock worth $2,834,139. 0.49% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Cadence Design Systems

A number of hedge funds have recently modified their holdings of CDNS. Assenagon Asset Management S.A. grew its stake in Cadence Design Systems by 1,097.5% during the 3rd quarter. Assenagon Asset Management S.A. now owns 2,818,141 shares of the software maker's stock worth $930,522,000 after buying an additional 2,582,812 shares during the last quarter. Legal & General Group Plc purchased a new stake in Cadence Design Systems in the second quarter valued at approximately $702,615,000. Jupiter Topco LLC purchased a new stake in Cadence Design Systems in the second quarter valued at approximately $688,746,000. Bank of New York Mellon Corp acquired a new stake in shares of Cadence Design Systems in the second quarter valued at approximately $607,350,000. Finally, Pictet Asset Management Holding SA boosted its holdings in shares of Cadence Design Systems by 118.5% in the third quarter. Pictet Asset Management Holding SA now owns 2,752,620 shares of the software maker's stock valued at $908,709,000 after acquiring an additional 1,493,024 shares during the period. 84.85% of the stock is currently owned by institutional investors and hedge funds.

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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