Cadence Design Earnings: Good Results; Steady Growth Trajectory Amid Macroeconomic Uncertainty

Wide-moat Cadence Design Systems reported first-quarter results that were largely in line with management’s guided range and our estimates, with no major surprises. After incorporating management’s slightly higher full-year guidance into our model, we maintain our fair value estimate of $300 per share. At current prices, we see the company as fairly valued. We believe that electronic design automation firms tend to be more stable than the semiconductor industry in general, given their placement in the value chain, an attractive feature in the current turbulence.