Cadence Design Systems Inc (CDNS)vsMicrosoft Corporation (MSFT)
CDNS
Cadence Design Systems Inc
$289.37
+1.55%
TECHNOLOGY · Cap: $79.69B
MSFT
Microsoft Corporation
$495.63
+0.65%
TECHNOLOGY · Cap: $3.68T
Smart Verdict
WallStSmart Research — data-driven comparison
Microsoft Corporation generates 5584% more annual revenue ($331.84B vs $5.84B). MSFT leads profitability with a 40.3% profit margin vs 23.6%. MSFT appears more attractively valued with a PEG of 1.60. MSFT earns a higher WallStSmart Score of 72/100 (B).
CDNS
Strong Buy68
out of 100
Grade: B-
MSFT
Strong Buy72
out of 100
Grade: B
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Earnings expanding 125.4% YoY
Safe zone — low bankruptcy risk
Large-cap with strong market position
Every $100 of equity generates 20 in profit
Keeps 24 of every $100 in revenue as profit
Strong operational efficiency at 28.6%
Mega-cap, among the largest globally
Every $100 of equity generates 30 in profit
Keeps 40 of every $100 in revenue as profit
Strong operational efficiency at 45.1%
Generating 19.6B in free cash flow
Conservative balance sheet, low leverage
Areas to Watch
Expensive relative to growth rate
Trading at 11.6x book value
Premium valuation, high expectations priced in
Expensive relative to growth rate
Moderate valuation
Trading at 8.3x book value
Comparative Analysis Report
WallStSmart ResearchBull Case : CDNS
The strongest argument for CDNS centers on EPS Growth, Altman Z-Score, Market Cap. Profitability is solid with margins at 23.6% and operating margin at 28.6%. Revenue growth of 24.2% demonstrates continued momentum.
Bull Case : MSFT
The strongest argument for MSFT centers on Market Cap, Return on Equity, Profit Margin. Profitability is solid with margins at 40.3% and operating margin at 45.1%. Revenue growth of 17.7% demonstrates continued momentum.
Bear Case : CDNS
The primary concerns for CDNS are PEG Ratio, Price/Book, P/E Ratio. A P/E of 56.5x leaves little room for execution misses.
Bear Case : MSFT
The primary concerns for MSFT are PEG Ratio, P/E Ratio, Price/Book.
Key Dynamics to Monitor
CDNS carries more volatility with a beta of 1.14 — expect wider price swings.
CDNS is growing revenue faster at 24.2% — sustainability is the question.
MSFT generates stronger free cash flow (19.6B), providing more financial flexibility.
Monitor SOFTWARE - APPLICATION industry trends, competitive dynamics, and regulatory changes.
Bottom Line
MSFT scores higher overall (72/100 vs 68/100), backed by strong 40.3% margins and 17.7% revenue growth. Both earn "Strong Buy" and "Strong Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Cadence Design Systems Inc
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Cadence Design Systems, Inc., headquartered in San Jose, California, is an American multinational computational software company. The company produces software, hardware and silicon structures for designing integrated circuits, systems on chips (SoCs) and printed circuit boards.
Microsoft Corporation
TECHNOLOGY · SOFTWARE - INFRASTRUCTURE · USA
Microsoft Corporation is an American multinational technology company which produces computer software, consumer electronics, personal computers, and related services. Its best known software products are the Microsoft Windows line of operating systems, the Microsoft Office suite, and the Internet Explorer and Edge web browsers. Its flagship hardware products are the Xbox video game consoles and the Microsoft Surface lineup of touchscreen personal computers. Microsoft ranked No. 21 in the 2020 Fortune 500 rankings of the largest United States corporations by total revenue; it was the world's largest software maker by revenue as of 2016. It is considered one of the Big Five companies in the U.S. information technology industry, along with Google, Apple, Amazon, and Facebook.
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