San Jose, California-based Cadence Design Systems, Inc. (CDNS) provides software, hardware, and other services worldwide. With a market cap of $89.2 billion, the company offers functional verification services, such as Jasper, Xcelium, a parallel logic simulation platform, Palladium, an enterprise emulation platform, and more.

The software giant is expected to announce its fiscal Q2 earnings results on Monday, July 28. Ahead of this event, analysts expect the company to report a profit of $1.22 per share, up 27.1% from $0.96 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in three of the past four quarters, while missing on one occasion.

For fiscal 2025, analysts expect CDNS to report an EPS of $5.36, up 19.1% year over year from $4.50 in fiscal 2024. Moreover, in FY2026, the company’s EPS is expected to increase 17.5% annually to $6.30. 

CDNS stock has declined marginally over the past 52 weeks, underperforming the Technology Select Sector SPDR Fund (XLK) 9.5% surge and the S&P 500 Index’s ($SPX) 11.9% uptick during the same time frame.

Shares of CDNS declined 1.3% following the release of its Q1 earnings on Apr. 28. The company’s revenue increased 23.1% from the prior year’s quarter to $1.2 billion and surpassed the consensus estimates. Moreover, its adjusted earnings grew 34.2% year-over-year to $1.57 and surpassed the analyst expectations.

Wall Street analysts are highly bullish about CDNS’ stock, with a "Strong Buy" rating overall. Among 18 analysts covering the stock, 15 recommend "Strong Buy," one suggests a “Moderate Buy,” one suggests a “Hold,” and one suggests “Strong Sell.” CDNS’ average analyst price target of $324.06 indicates a potential upside of 1.2% from the current levels.