Cadence Stock Surges After Q4 Beat, Strong Outlook

by | Feb 18, 2026 | General

Cadence Design Systems, Inc. shares are trading higher Wednesday after the company reported better-than-expected fourth-quarter financial results and issued first-quarter adjusted earnings per share guidance above estimates on Tuesday after the market closed.

Fourth-Quarter Results And Guidance

Cadence reported adjusted earnings per share of $1.99, beating the consensus estimate of $1.91. In addition, the company reported revenue of $1.44 billion, beating the consensus estimate of $1.42 billion.

Revenue increased 14% year-over-year from $1.356 billion in the same quarter last year.

Year-end backlog reached a record $7.8 billion, with $3.8 billion expected to be recognized over the next 12 months from remaining performance obligations. The company ended the quarter with approximately $3 billion in cash and cash equivalents.

“Strong customer demand for our expanding AI-driven product portfolio and the essential nature of Cadence’s engineering software position us well to capture the massive opportunities in the AI era,” said Anirudh Devgan, president and CEO.

Looking ahead, the company expects fiscal-year adjusted earnings per share from $8.05 to $8.15, versus the consensus estimate of $8.05. It anticipates revenue from $5.90 billion to $6.00 billion, versus the consensus estimate of $5.94 billion.

For the first-quarter, the company sees adjusted earnings per share from $1.89 to $1.95, versus the consensus estimate of $1.80.

Consensus Ratings And Analyst Action

The company has a consensus rating of Buy and a consensus price target of $366.50. Recent analyst action include:

  • Needham analyst Charles Shi reiterated a Buy rating on Cadence and maintained a $390 price target.
  • Morgan Stanley analyst Lee Simpson maintained an Overweight rating on Cadence and lowered the price target from $385 to $370.
  • Piper Sandler analyst Clarke Jeffries maintained a Neutral rating Cadence and lowered the price target from $355 to $319.
  • Rosenblatt analyst Blair Abernethy upgraded Cadence from a Neutral rating to a Buy rating and raised he price target from $335 to $360.

Cadence Shares Climb Higher

CDNS Price Action: At the time of writing, Cadence stock is trading 5.43% higher at $298.83, according to data from Benzinga Pro.

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