Cadence Design Systems Earnings Preview
Analyst Expectations for Cadence’s Earnings
Semiconductor design software provider Cadence Design Systems will be reporting earnings tomorrow after the bell. Here’s what to look for.
Last Quarter Performance: Last quarter, Cadence reported revenues of $1.07 billion, marking an 18.8% year-on-year increase. Although in line with analyst expectations, it was considered a weaker quarter with underwhelming revenue guidance for the next quarter.
Current Expectations: Analysts anticipate a 0.3% year-on-year revenue decline to $1.02 billion for this quarter, compared to a 13.3% increase in the same quarter last year. Adjusted earnings are projected at $1.13 per share.
Analyst Sentiment: Majority of analysts covering Cadence have maintained their estimates, indicating confidence in the company’s performance. With historically strong revenue beating patterns, analysts have set a positive tone for the upcoming earnings.
Industry Comparison and Market Trends
Peer Performance: Among Cadence’s software peers, only Adobe has reported results, showcasing an 11.3% year-on-year revenue growth, exceeding analyst expectations. However, the stock saw a 9.1% decline post-results.
Market Trends: Growth stocks, including Cadence, have faced volatility amid mixed inflation data. While the software sector has witnessed a 9.3% decline in share prices, Cadence specifically has fallen by 11.5% in the past month.
Final Thoughts
Price Target Analysis: Analysts predict a target price of $323.8 for Cadence, currently trading at $279.7, heading into the earnings. This gap suggests potential growth opportunities.
