Cadence Design Systems, Inc. (CDNS) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-57.1%

$141.83

vs $330.25 price

Levered DCF

$138.65

After debt service

Piotroski score

5 / 9

Average

Altman Z-score

12.14

Safe zone

Rating

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	76.43×	77.24×	70.56×	51.32×	73.37×	63.16×	19.16×	34.51×
P/B	15.49×	17.44×	21.55×	15.87×	18.6×	14.98×	9.01×	9.24×
P/S	16.01×	17.56×	17.94×	12.23×	17.06×	13.92×	8.11×	5.57×
EV / EBITDA	45.02×	48.85×	49.97×	36.2×	54.94×	45.89×	30.07×	22.46×
Gross margin	86.4%	86.0%	89.4%	89.6%	89.7%	88.6%	88.6%	87.9%
Operating margin	31.1%	29.1%	30.6%	30.1%	26.1%	24.1%	21.1%	18.5%
Net margin	20.9%	22.7%	25.5%	23.8%	23.3%	22.0%	42.3%	16.2%
Current ratio	2.86×	2.93×	1.24×	1.27×	1.77×	1.86×	1.74×	1.34×
Debt / equity	0.45×	0.55×	0.22×	0.32×	0.17×	0.18×	0.2×	0.35×
Interest coverage	14.16×	17.77×	34.58×	46.82×	45.88×	31.11×	26.12×	17.12×
Dividend yield	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
Payout ratio	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	20.3%	22.6%	30.6%	30.9%	25.4%	23.7%	47.0%	26.8%
Return on invested capital	14.1%	13.4%	23.0%	22.4%	20.7%	19.1%	18.3%	19.6%
Return on assets	10.9%	11.8%	18.4%	16.5%	15.9%	15.0%	29.5%	14.0%
Free cash flow yield	1.9%	1.4%	1.7%	2.6%	2.0%	2.2%	3.5%	4.6%
Earnings yield	1.3%	1.3%	1.4%	1.9%	1.4%	1.6%	5.2%	2.9%
Enterprise value	$84.3B	$81.4B	$73.1B	$43.6B	$50.3B	$36.9B	$18.7B	$11.8B
Net debt / EBITDA	-0.28×	-0.04×	-0.17×	0×	-0.69×	-0.58×	-0.44×	-0.17×
Cash conversion cycle (days)	-215	196	121	129	180	138	124	83