Analysts on Wall Street largely remain bullish on Cadence Design Systems after its fourth-quarter earnings, which exceeded expectations with adjusted earnings of $1.99 per share and $1.44 billion in revenue. Concerns over AI disrupting the electronic design automation (EDA) sector were deemed exaggerated, with analysts highlighting the complexity of Cadence’s software. Key insights from analysts include JPMorgan’s view that Cadence’s robust customer networks and data moat protect against AI threats, and increased automation capabilities are expected to enhance monetization. Piper Sandler maintains a Neutral rating with a price target of $319, while Morgan Stanley’s Overweight rating now targets $370, reflecting continued growth potential. Bank of America and Wells Fargo also express confidence in Cadence’s resilience within a challenging market. Overall, most analysts retained a positive outlook, indicating that Cadence holds significant opportunities amid evolving AI applications in chip design.
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