In a report released yesterday, Joseph Quatrochi from Wells Fargo maintained a Buy rating on Cadence Design (CDNS – Research Report), with a price target of $350.00.
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Joseph Quatrochi has given his Buy rating due to a combination of factors including Cadence Design’s positive revenue guidance and the acceleration of recurring revenue growth. The company has raised its 2025 revenue and EPS guidance, which is a positive indicator despite the unchanged EBIT percentage. This suggests that the company is experiencing stronger-than-expected recurring revenue, which is a favorable sign for investors.
Additionally, Cadence’s limited direct exposure to hardware tariffs due to its diversified manufacturing footprint is another positive aspect. The company’s outlook for China remains flat, but it continues to see strong design activity in the region. These factors, along with the company’s commitment to returning more than 50% of its free cash flow, contribute to the Buy rating recommendation.