Cadence Design Systems (CDNS) Reports Next Week: Wall Street Expects Earnings Growth

Core Viewpoint - Cadence Design Systems (CDNS) is anticipated to report a year-over-year increase in earnings and revenues for the quarter ended September 2024, with the earnings report expected on October 28 [1][2]. Group 1: Earnings Expectations - The consensus estimate for Cadence's quarterly earnings is $1.44 per share, reflecting a year-over-year increase of 14.3% [2]. - Expected revenues for the quarter are $1.18 billion, which is a 15.7% increase from the same quarter last year [2]. Group 2: Estimate Revisions - The consensus EPS estimate has been revised 0.16% lower over the last 30 days, indicating a reassessment by analysts [3]. - Despite the slight downward revision, the Most Accurate Estimate for Cadence is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +0.69% [6][7]. Group 3: Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive Earnings ESP reading is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) [5]. - Cadence holds a Zacks Rank of 2, indicating a favorable outlook for beating the consensus EPS estimate [7]. Group 4: Historical Performance - In the last reported quarter, Cadence exceeded the expected earnings of $1.23 per share by delivering $1.28, resulting in a surprise of +4.07% [8]. - Over the past four quarters, Cadence has consistently beaten consensus EPS estimates [8]. Group 5: Industry Context - SS&C Technologies, another player in the Zacks Computer - Software industry, is expected to report earnings of $1.26 per share for the same quarter, reflecting a year-over-year change of +7.7% [10]. - SS&C's revenues are projected to be $1.44 billion, up 5.5% from the previous year, but it has a negative Earnings ESP of -0.32% [10].