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Cadence Design Systems (CDNS) Stock Moves 0.1%: What You Should Know

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In the latest trading session, Cadence Design Systems (CDNS - Free Report) closed at $64.54, marking a +0.1% move from the previous day. The stock outpaced the S&P 500's daily of 0%. Meanwhile, the Dow lost 0.05%, and the Nasdaq, a tech-heavy index, lost 0.21%.

Prior to today's trading, shares of the maker of hardware and software products for validating chip designs had gained 6.28% over the past month. This has lagged the Computer and Technology sector's gain of 7.39% and outpaced the S&P 500's gain of 5.49% in that time.

Investors will be hoping for strength from CDNS as it approaches its next earnings release, which is expected to be April 22, 2019. In that report, analysts expect CDNS to post earnings of $0.50 per share. This would mark year-over-year growth of 25%. Our most recent consensus estimate is calling for quarterly revenue of $567.11 million, up 9.63% from the year-ago period.

CDNS's full-year Zacks Consensus Estimates are calling for earnings of $2.05 per share and revenue of $2.28 billion. These results would represent year-over-year changes of +9.63% and +6.74%, respectively.

Investors should also note any recent changes to analyst estimates for CDNS. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. CDNS currently has a Zacks Rank of #1 (Strong Buy).

Valuation is also important, so investors should note that CDNS has a Forward P/E ratio of 31.53 right now. This valuation marks a premium compared to its industry's average Forward P/E of 31.05.

Also, we should mention that CDNS has a PEG ratio of 2.63. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Computer - Software was holding an average PEG ratio of 2.2 at yesterday's closing price.

The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 10, which puts it in the top 4% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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