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Investing.com - Stifel has reiterated its Buy rating and $395.00 price target on Cadence Design Systems (NASDAQ:CDNS) following a fireside chat with company senior vice president Nimish Modi at Stifel’s 2025 Tech Executive Summit in Deer Valley, Utah. According to InvestingPro data, analysts maintain a strong bullish consensus on CDNS, with targets ranging from $200 to $410.
During the discussion, Modi, who serves as SVP & GM of Strategy and New Ventures, focused on Cadence’s expanding role in enabling AI-first silicon and system design across its software and hardware stack, highlighting the company’s alignment with complex and high-growth areas including AI, custom silicon, and electrical-mechanical convergence.
Management reaffirmed its fiscal year 2025 guidance of approximately 13% revenue growth and 16% EPS growth, with Electronic Design Automation (EDA) continuing to capture an increasing share of semiconductor R&D budgets, estimated at 14-15%.
Stifel noted that Cadence’s ratable business model, strong backlog, and multi-year tailwinds position it as a "strategic long-term compounder in the design ecosystem."
The research firm also highlighted that management’s reaffirmation of strength in the China market could signal upside potential for the stock in the near term.
In other recent news, Cadence Design Systems reported strong second-quarter earnings, with revenue reaching $1.275 billion, surpassing consensus estimates of $1.250 billion. The company also reported adjusted earnings per share of $1.65, exceeding the $1.56 forecast and representing a 29% increase from the previous year. Following this performance, Stifel raised its price target for Cadence to $395, maintaining a Buy rating. Similarly, KeyBanc increased its price target to $405, citing Cadence’s best hardware quarter on record.
Additionally, Berenberg raised its price target to $400, highlighting the company’s solid beat-and-raise performance. In terms of strategic moves, Cadence has completed its acquisition of the Arm Artisan foundation IP business, which enhances its design IP portfolio. This acquisition aims to improve customer time to market and optimize cost, power, and performance in system-on-chip designs.
Furthermore, Cadence unveiled a new Dynamic Power Analysis App for its Palladium Z3 Enterprise Emulation Platform, developed in collaboration with NVIDIA. This tool allows for hardware-accelerated dynamic power analysis of AI designs with high accuracy. These developments underscore Cadence’s ongoing efforts to strengthen its market position and technology offerings.
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