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Cadence Design Systems, Inc. (NASDAQ:CDNS) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of CDNS, it is a company with great financial health as well as a a strong track record of performance. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Cadence Design Systems here.
Outstanding track record with excellent balance sheet
Over the past year, CDNS has grown its earnings by 69%, with its most recent figure exceeding its annual average over the past five years. The strong earnings growth is reflected in impressive double-digit 27% return to shareholders, which is what investors like to see! CDNS is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that CDNS has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. CDNS seems to have put its debt to good use, generating operating cash levels of 1.36x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.
For Cadence Design Systems, I’ve compiled three pertinent factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for CDNS’s future growth? Take a look at our free research report of analyst consensus for CDNS’s outlook.
- Valuation: What is CDNS worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether CDNS is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CDNS? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.