Cadence Design Systems Inc. (0HS2) fair value: what the stock is really worth
As of Oct 2, 2026: fair value of Cadence Design Systems Inc. $212, price $348, upside -39.1%, quality 74 out of 100. Calculated from audited financials with 26 valuation models and 37 quality factors, updated daily.
- Fair value above price? No
- Good quality? Yes
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Cadence Design Systems Inc.
0HS2 · LSEStretched ValuationQuality growthStrong overvaluation with only moderate quality.
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Price vs Fair Value
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 24, 2026.
How to read this chart
60‑month range $118.61 – $411.83 · fair‑value band $142.70 – $275.12 · the $348.37 price screens above the $212.18 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Sep 24, 2026.
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Company profile
Cadence Design Systems, Inc. develops computational, AI-driven software, hardware, and silicon intellectual property products and solutions.
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Cadence Design Systems, Inc. develops computational, AI-driven software, hardware, and silicon intellectual property products and solutions. The company offers functional verification services, such as Jasper, a formal verification platform; Xcelium, a parallel logic simulation platform; Verisium, a generative AI solution; Palladium, an enterprise emulation platform; and Protium, a prototyping platform for chip verification, as well as digital IC design and sign off products, including In novus platform; and custom IC design and simulation product include Virtuoso, a platform to design and verify analog. It also provides Xcelium logic simulator and other front-end verification and virtual prototyping technologies; controllers and physical interfaces; PCI Express, universal accelerator and compute express links, and multiple memory interfaces; and Ten Silica, a digital signal processor. In addition, the company's design IP portfolio includes serializer/deserializer, peripheral component interconnect, USB, and other standard protocols; and Secure-IC, a solution for embedded security IP. Additionally, it provides System Design and Analysis (SD&A) platform, a solution that enables end-to-end system-level design and verification across chips, packages, PCBs, and electronic systems; Allegro X and Orca X platforms for PCB and advanced packaging; Sigrity X for signal and power integrity; AIR for RF design; Fidelity for computational fluid dynamics; Celsius for thermal and airflow analysis; Clarity 3D solver for electromagnetic and power electronics analysis and simulation; Integrity 3D-IC solution for 3D-IC and multi-chiplet designs; the Optimality Intelligent System Explorer, Reality digital twin, and Millennium enterprise multiphasic platforms; Allegro system design platform; and molecular modeling and simulation solutions and services. The company has a strategic collaboration with NVIDIA. The company was incorporated in 1987 and is headquartered in San Jose, California.
Stock analysis
Cadence Design Systems Inc. (0HS2) currently trades at $348.37, while our model-based Fair Value estimate is $212.18, 39.1% below the price, so the stock looks overvalued today.
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Valuation
Bull case: the DCF Models group reads highest at a median of $127.36 per share, and 0 of the 24 models we run sit above the $348.37 price.
Bear case: the Economic Profit group reads lowest at $31.91, and 24 of the 24 models stay below the price. Evidence for this calculation is medium.
Scenario range: $142.70 (bear) to $275.12 (bull), the price of $348.37 sits above it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 74/100 (solid quality), in the Technology sector.
Healthy Growth: Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Cadence Design Systems Inc. reported revenue of $5.3B in FY2025 versus $2.7B in FY2021, a compound +18.5%/yr. Reported net income was $1.1B in FY2025, compounding +17.1%/yr from FY2021.
Key figures
Market cap $95.2B · P/E ratio 1.2 · P/S ratio 0.26 · EPS (TTM) $2.68 · Net margin 20.9% · Return on equity 20.7% · Return on assets (EBIT) 17.7% · Operating margin 29.7%.
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 52 out of 100 (low confidence).
What moves the price
The share trades about 15% below its 52-week high and 32% above its 52-week low, currently above its 200-day average.
For context, the median of 10 Technology peers we cover trades at 10% fair-value upside, at −39%, 0HS2 screens richer than that median.
Fair Value models
All 24 models by family
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Set up alert →Quality Score breakdown
Of which business quality 74 · Market factors (momentum, volatility) 44
Revenue & earnings trend
Growth Forecast
0HS2 screens overvalued: fair value 39% below the price. Compare with SAP SE →
Compare Cadence Design Systems Inc. with another stock
Price, fair value, quality and upside side by side.
Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Software - Application · 685 stocks
Valuation Multiplesvs Software - Application median · lower = cheaper
Strength profile in five axes (Snowflake)
VALUE 0: the price sits above our fair-value range.
Context: sector, industry, market
- Is the Information Technology sector expensive or cheap?
- P/E, EV/EBITDA and margins by industry (reference tables)
- Undervalued stocks: UK Stocks
- Valuation of the UK market
Values & ESG
Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.
Similar stocks
10 more Software - Application stocks, each showing price versus our Fair Value estimate.
| Stock | Price | Fair Value | vs Fair Value |
|---|---|---|---|
| SAP SE SAP | €186.74 | €172.46 | −8% |
| Salesforce, Inc CRM | $229.57 | $342.73 | +49% |
| Shopify Inc SHOP | $144.01 | $64.36 | −55% |
| ServiceNow, Inc NOW | $134.01 | $147.41 | +10% |
| Uber Technologies, Inc UBER | $69.36 | $103.69 | +49% |
| Snowflake Inc SNOW | $330.31 | $74.36 | −77% |
| Automatic Data Processing, Inc ADP | $261.80 | $150.01 | −43% |
| Adobe Inc ADBE | $239.94 | $454.04 | +89% |
| Datadog, Inc DDOG | $268.70 | $32.52 | −88% |
| Intuit Inc INTU | $268.03 | $459.14 | +71% |
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