Independent equity research
Is Cadence Design Systems (CDNS) a Buy, Hold or Sell?
Cadence Design Systems — our independent, AI-built valuation and rating, in brief.
SELL (reduce)
12-mo fair value
$217.00
To fair value
−25%
By · report dated 2026-08-14 · fair value derived independently of the market price.
The thesis, in brief
At $326 Cadence discounts ~19.6% revenue growth every year for a decade at a 28% owner-FCF margin, so even a bull case crediting the agentic-AI TAM expansion is worth only $302, and the shares de-rate toward $217 as 2027 growth normalises to the low teens
How we value it
We value Cadence Design Systems using 10-yr DCF on owner FCF after SBC, WACC 9.6%, g 2.5%; blended 50/50 with 30.7x 2027E adj EPS. The 12-month fair value is set from that intrinsic estimate first, then compared to the market to read the upside or downside — never anchored to the current price.
What the full report covers
- Business & moat + industry cycle
- Earnings quality & normalized EPS
- Returns on capital (ROIC vs WACC)
- Balance-sheet safety
- Two independent valuations (DCF + multiples)
- Bear / base / bull fair values
- Earnings-call analysis
- Insider activity & positioning
- Technicals (RSI / ADX)
- A falsifiable thesis
Read the full Cadence Design Systems report
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