Lee Simpson, an analyst from Morgan Stanley, maintained the Buy rating on Cadence Design. The associated price target was raised to $360.00.
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Lee Simpson’s rating is based on several factors that suggest a positive outlook for Cadence Design Systems. Despite some concerns about potential slowing in core EDA growth in the near term, Simpson anticipates strong interest from hardware, IP, and systems customers, which should help maintain the company’s fiscal year 2025 guidance of an 11-12% increase year-over-year. The recent easing of restrictions on tool shipments to China has alleviated some market concerns, and management is expected to confirm stable sales in the region, contributing to the overall positive sentiment.
Simpson also highlights the strength in leading-edge logic drivers, including AI, which are expected to remain robust. The company’s substantial backlog, estimated at over $6 billion, provides a solid foundation for future growth. With these factors in mind, Simpson has raised the price target for Cadence Design Systems to $360, indicating confidence in the company’s ability to capitalize on these opportunities and deliver value to shareholders.
Simpson covers the Technology sector, focusing on stocks such as ASML Holding NV, Cadence Design, and Synopsys. According to TipRanks, Simpson has an average return of 7.7% and a 63.77% success rate on recommended stocks.
In another report released yesterday, Mizuho Securities also maintained a Buy rating on the stock with a $360.00 price target.