Stock Analysis on Net

Cadence Design Systems Inc. (NASDAQ:CDNS)

Adjusted Financial Ratios

Microsoft Excel

Adjusted Financial Ratios (Summary)

Cadence Design Systems Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Activity Ratio
Total Asset Turnover
Reported 0.72 0.69 0.68 0.68 0.70
Adjusted 0.85 0.86 0.85 0.87 0.90
Liquidity Ratio
Current Ratio
Reported 1.24 1.27 1.77 1.86 1.74
Adjusted 2.14 2.60 4.12 4.23 3.69
Solvency Ratios
Debt to Equity
Reported 0.19 0.27 0.13 0.14 0.16
Adjusted 0.24 0.34 0.18 0.21 0.25
Debt to Capital
Reported 0.16 0.21 0.11 0.12 0.14
Adjusted 0.20 0.26 0.15 0.18 0.20
Financial Leverage
Reported 1.67 1.87 1.60 1.58 1.60
Adjusted 1.45 1.59 1.37 1.38 1.45
Profitability Ratios
Net Profit Margin
Reported 25.46% 23.84% 23.29% 22.02% 42.33%
Adjusted 24.27% 21.92% 23.64% 25.29% 17.87%
Return on Equity (ROE)
Reported 30.58% 30.93% 25.39% 23.69% 47.03%
Adjusted 29.91% 30.05% 27.61% 30.46% 23.32%
Return on Assets (ROA)
Reported 18.36% 16.53% 15.87% 14.95% 29.46%
Adjusted 20.61% 18.87% 20.14% 22.04% 16.09%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Cadence Design Systems Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Cadence Design Systems Inc. adjusted current ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Cadence Design Systems Inc. adjusted debt-to-equity ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 not reaching 2021 level.
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Cadence Design Systems Inc. adjusted debt-to-capital ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 not reaching 2021 level.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Cadence Design Systems Inc. adjusted financial leverage ratio increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Cadence Design Systems Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Cadence Design Systems Inc. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Cadence Design Systems Inc. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Cadence Design Systems Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Revenue 4,089,986 3,561,718 2,988,244 2,682,891 2,336,319
Total assets 5,669,491 5,137,071 4,386,299 3,950,785 3,357,225
Activity Ratio
Total asset turnover1 0.72 0.69 0.68 0.68 0.70
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted revenue2 4,071,879 3,688,690 3,089,413 2,807,929 2,364,028
Adjusted total assets3 4,794,043 4,285,670 3,626,221 3,221,362 2,625,727
Activity Ratio
Adjusted total asset turnover4 0.85 0.86 0.85 0.87 0.90

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Total asset turnover = Revenue ÷ Total assets
= 4,089,986 ÷ 5,669,491 = 0.72

2 Adjusted revenue. See details »

3 Adjusted total assets. See details »

4 2023 Calculation
Adjusted total asset turnover = Adjusted revenue ÷ Adjusted total assets
= 4,071,879 ÷ 4,794,043 = 0.85

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Cadence Design Systems Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Current Ratio

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Current assets 1,976,217 1,706,767 1,715,769 1,478,587 1,169,343
Current liabilities 1,590,867 1,347,696 971,225 796,808 672,391
Liquidity Ratio
Current ratio1 1.24 1.27 1.77 1.86 1.74
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted current assets2 1,980,770 1,709,057 1,719,461 1,481,454 1,170,212
Adjusted current liabilities3 925,843 657,158 417,283 349,951 316,908
Liquidity Ratio
Adjusted current ratio4 2.14 2.60 4.12 4.23 3.69

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= 1,976,217 ÷ 1,590,867 = 1.24

2 Adjusted current assets. See details »

3 Adjusted current liabilities. See details »

4 2023 Calculation
Adjusted current ratio = Adjusted current assets ÷ Adjusted current liabilities
= 1,980,770 ÷ 925,843 = 2.14

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Cadence Design Systems Inc. adjusted current ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Debt to Equity

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Total debt 649,056 748,078 347,588 346,793 346,019
Stockholders’ equity 3,404,271 2,745,113 2,740,675 2,493,018 2,102,894
Solvency Ratio
Debt to equity1 0.19 0.27 0.13 0.14 0.16
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted total debt2 806,033 924,152 479,980 494,629 456,359
Adjusted stockholders’ equity3 3,304,198 2,690,533 2,644,862 2,331,143 1,811,105
Solvency Ratio
Adjusted debt to equity4 0.24 0.34 0.18 0.21 0.25

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= 649,056 ÷ 3,404,271 = 0.19

2 Adjusted total debt. See details »

3 Adjusted stockholders’ equity. See details »

4 2023 Calculation
Adjusted debt to equity = Adjusted total debt ÷ Adjusted stockholders’ equity
= 806,033 ÷ 3,304,198 = 0.24

Solvency ratio Description The company
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Cadence Design Systems Inc. adjusted debt-to-equity ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 not reaching 2021 level.

Adjusted Debt to Capital

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Total debt 649,056 748,078 347,588 346,793 346,019
Total capital 4,053,327 3,493,191 3,088,263 2,839,811 2,448,913
Solvency Ratio
Debt to capital1 0.16 0.21 0.11 0.12 0.14
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted total debt2 806,033 924,152 479,980 494,629 456,359
Adjusted total capital3 4,110,231 3,614,685 3,124,842 2,825,772 2,267,464
Solvency Ratio
Adjusted debt to capital4 0.20 0.26 0.15 0.18 0.20

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 649,056 ÷ 4,053,327 = 0.16

2 Adjusted total debt. See details »

3 Adjusted total capital. See details »

4 2023 Calculation
Adjusted debt to capital = Adjusted total debt ÷ Adjusted total capital
= 806,033 ÷ 4,110,231 = 0.20

Solvency ratio Description The company
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Cadence Design Systems Inc. adjusted debt-to-capital ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 not reaching 2021 level.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Total assets 5,669,491 5,137,071 4,386,299 3,950,785 3,357,225
Stockholders’ equity 3,404,271 2,745,113 2,740,675 2,493,018 2,102,894
Solvency Ratio
Financial leverage1 1.67 1.87 1.60 1.58 1.60
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted total assets2 4,794,043 4,285,670 3,626,221 3,221,362 2,625,727
Adjusted stockholders’ equity3 3,304,198 2,690,533 2,644,862 2,331,143 1,811,105
Solvency Ratio
Adjusted financial leverage4 1.45 1.59 1.37 1.38 1.45

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= 5,669,491 ÷ 3,404,271 = 1.67

2 Adjusted total assets. See details »

3 Adjusted stockholders’ equity. See details »

4 2023 Calculation
Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 4,794,043 ÷ 3,304,198 = 1.45

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Cadence Design Systems Inc. adjusted financial leverage ratio increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Net income 1,041,144 848,952 695,955 590,644 988,979
Revenue 4,089,986 3,561,718 2,988,244 2,682,891 2,336,319
Profitability Ratio
Net profit margin1 25.46% 23.84% 23.29% 22.02% 42.33%
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted net income2 988,274 808,547 730,235 710,119 422,351
Adjusted revenue3 4,071,879 3,688,690 3,089,413 2,807,929 2,364,028
Profitability Ratio
Adjusted net profit margin4 24.27% 21.92% 23.64% 25.29% 17.87%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Net profit margin = 100 × Net income ÷ Revenue
= 100 × 1,041,144 ÷ 4,089,986 = 25.46%

2 Adjusted net income. See details »

3 Adjusted revenue. See details »

4 2023 Calculation
Adjusted net profit margin = 100 × Adjusted net income ÷ Adjusted revenue
= 100 × 988,274 ÷ 4,071,879 = 24.27%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Cadence Design Systems Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Net income 1,041,144 848,952 695,955 590,644 988,979
Stockholders’ equity 3,404,271 2,745,113 2,740,675 2,493,018 2,102,894
Profitability Ratio
ROE1 30.58% 30.93% 25.39% 23.69% 47.03%
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted net income2 988,274 808,547 730,235 710,119 422,351
Adjusted stockholders’ equity3 3,304,198 2,690,533 2,644,862 2,331,143 1,811,105
Profitability Ratio
Adjusted ROE4 29.91% 30.05% 27.61% 30.46% 23.32%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 1,041,144 ÷ 3,404,271 = 30.58%

2 Adjusted net income. See details »

3 Adjusted stockholders’ equity. See details »

4 2023 Calculation
Adjusted ROE = 100 × Adjusted net income ÷ Adjusted stockholders’ equity
= 100 × 988,274 ÷ 3,304,198 = 29.91%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Cadence Design Systems Inc. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Reported
Selected Financial Data (US$ in thousands)
Net income 1,041,144 848,952 695,955 590,644 988,979
Total assets 5,669,491 5,137,071 4,386,299 3,950,785 3,357,225
Profitability Ratio
ROA1 18.36% 16.53% 15.87% 14.95% 29.46%
Adjusted
Selected Financial Data (US$ in thousands)
Adjusted net income2 988,274 808,547 730,235 710,119 422,351
Adjusted total assets3 4,794,043 4,285,670 3,626,221 3,221,362 2,625,727
Profitability Ratio
Adjusted ROA4 20.61% 18.87% 20.14% 22.04% 16.09%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 1,041,144 ÷ 5,669,491 = 18.36%

2 Adjusted net income. See details »

3 Adjusted total assets. See details »

4 2023 Calculation
Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 988,274 ÷ 4,794,043 = 20.61%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Cadence Design Systems Inc. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.