Analyzing Exa Corporation (EXA) & Cadence Design Systems (CDNS)
Exa Corporation (NASDAQ: EXA) and Cadence Design Systems (NASDAQ:CDNS) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, institutional ownership, profitability, valuation and earnings.
This table compares Exa Corporation and Cadence Design Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cadence Design Systems||12.86%||27.81%||11.00%|
Earnings and Valuation
This table compares Exa Corporation and Cadence Design Systems’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Exa Corporation||$72.69 million||5.00||$1.48 million||($0.32)||-75.65|
|Cadence Design Systems||$1.87 billion||6.10||$421.11 million||$0.87||46.76|
Cadence Design Systems has higher revenue and earnings than Exa Corporation. Exa Corporation is trading at a lower price-to-earnings ratio than Cadence Design Systems, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current recommendations for Exa Corporation and Cadence Design Systems, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cadence Design Systems||1||1||3||0||2.40|
Exa Corporation currently has a consensus target price of $20.63, indicating a potential downside of 14.81%. Cadence Design Systems has a consensus target price of $32.00, indicating a potential downside of 21.34%. Given Exa Corporation’s higher possible upside, analysts plainly believe Exa Corporation is more favorable than Cadence Design Systems.
Insider & Institutional Ownership
76.0% of Exa Corporation shares are held by institutional investors. Comparatively, 84.3% of Cadence Design Systems shares are held by institutional investors. 11.5% of Exa Corporation shares are held by company insiders. Comparatively, 2.6% of Cadence Design Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Volatility & Risk
Exa Corporation has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500. Comparatively, Cadence Design Systems has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500.
Cadence Design Systems beats Exa Corporation on 11 of the 13 factors compared between the two stocks.
About Exa Corporation
Exa Corporation develops, sells and supports simulation software and services that manufacturers use in design and engineering processes. The Company focuses primarily on the ground transportation market, including manufacturers in the passenger vehicle, highway truck, off-highway vehicle and train markets, as well as their suppliers. Its product, PowerFLOW, is a software solution for simulating fluid flow problems, including aerodynamics, thermal management and aeroacoustics, or wind noise. PowerFLOW uses its Digital Physics technology that enables it to predict fluid flows. PowerFLOW directly simulates unpredictable turbulent scales. The PowerFLOW software suite includes the simulation engine and grid generation engine, along with pre- and post-processing software products. The software is delivered in client/server architecture, or through its cloud-based offering, ExaCLOUD. With the ExaCLOUD solution, various client features and functions are accessed through a Web browser.
About Cadence Design Systems
Cadence Design Systems, Inc. provides solutions that enable its customers to design electronic products. The Company’s product categories include Functional Verification, Digital integrated circuits (IC) Design and Signoff, Custom IC Design and Verification, System Interconnect and Analysis, and intellectual property (IP). Functional verification products are used to verify that the circuitry or the software designed will perform as intended. Digital IC design offerings are used to create representations of a digital circuit or an IC that can be verified for correctness prior to implementation. Custom IC design and verification offerings are used to create schematic and physical representations of circuits down to the transistor level for analog and memory designs. System Interconnect and Analysis offerings are used to develop printed circuit boards and IC packages. Design IP offerings consist of functional blocks, which customers integrate into their ICs for the development process.
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