CDNS vs. IBM: Cadence Design Systems vs. IBM Stock Comparison

November 11, 2026

How do Cadence Design Systems (CDNS) and IBM (IBM) stack up? This page sets them side by side across company profile, performance and risk, profitability, growth, financial strength, dividends, and valuation, with selected fundamentals also measured against each stock's industry-group peers.

Company Profile

Cadence Design Systems (CDNS) and IBM (IBM) both fall under the Software & Services industry group, but CDNS is classified in Software while IBM is classified in IT Services.

Company profile comparison for Cadence Design Systems (CDNS) and IBM (IBM)
Profile Item	CDNS	IBM
Name	Cadence Design Systems, Inc.	International Business Machines Corporation
Country/Region	United States	United States
GICS Sector	Information Technology	Information Technology
GICS Industry Group	Software & Services	Software & Services
GICS Industry	Software	IT Services
GICS Sub-Industry	Application Software	IT Consulting & Other Services
Market Capitalization	87.78 billion USD	231.55 billion USD
Currency	USD	USD
Exchange	Nasdaq	NYSE
Listing Date	June 10, 1987	January 2, 1962
Security Type	Common Stock	Common Stock

Price Performance

Cumulative Growth

CDNS

IBM

GSPC

Cadence Design Systems (CDNS) vs. IBM (IBM), with S&P 500 (GSPC) for reference: Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

Loading price history…

Trailing total returns for Cadence Design Systems (CDNS) and IBM (IBM). Returns over one year are annualized.

Calendar-Year Returns

Loading price history…

Calendar-year total returns for Cadence Design Systems (CDNS) and IBM (IBM). Each bar is that year's total return, measured year-end to year-end.

Performance Metrics

Price performance metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Total Return (1Y)	3.07%	-16.98%
Total Return (3Y, Annualized)	9.32%	22.40%
Total Return (5Y, Annualized)	12.93%	19.64%

Risk Profile

Drawdown History

CDNS

IBM

GSPC

Cadence Design Systems (CDNS) vs. IBM (IBM), with S&P 500 (GSPC) for reference: Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Return Distribution

Loading price history…

Distribution of monthly total returns for Cadence Design Systems (CDNS) and IBM (IBM). Each bar is the share of months whose return fell in that 5% bucket.

Risk Metrics

Risk profile metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Volatility (1Y, Annualized)	42.21%	48.48%
Beta (5Y)	1.09	0.79
Max Drawdown (5Y)	-34.21%	-37.50%
Avg. Volume (3M)	2.41M	5.30M

Risk-Adjusted Performance

Risk-Return Positioning

CDNS and IBM are plotted by 1-year volatility (risk) and 1-year return. The dashed Capital Allocation Line runs from the risk-free rate through the shared industry median.

Risk-Adjusted Metrics

Risk-adjusted metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Sharpe Ratio (1Y)	-0.03	-0.44
Sortino Ratio (1Y)	-0.04	-0.56

Profitability

ROE (TTM)

Both Cadence Design Systems (CDNS) at 22.87% and IBM (IBM) at 34.77% sit in the top peer quartile for ROE, suggesting each generates more profit from shareholders’ equity than typical industry peers.

CDNS

Software & Services industry group

22.87%

Max: 53.85%
CDNS: 22.87%
Q3: 17.90%
Median: 6.59%
Q1: -9.59%
Min: -50.52%

IBM

Software & Services industry group

34.77%

Max: 53.85%
IBM: 34.77%
Q3: 17.90%
Median: 6.59%
Q1: -9.59%
Min: -50.52%

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their ROE against the Software & Services industry group benchmark.

Net Margin (TTM)

For every dollar of sales, both Cadence Design Systems (CDNS) at 22.52% and IBM (IBM) at 15.99% retain more as net profit than most peers, landing in the top net margin quartile of their industries.

CDNS

Software & Services industry group

22.52%

Max: 41.17%
CDNS: 22.52%
Q3: 15.28%
Median: 4.63%
Q1: -5.42%
Min: -33.17%

IBM

Software & Services industry group

15.99%

Max: 41.17%
IBM: 15.99%
Q3: 15.28%
Median: 4.63%
Q1: -5.42%
Min: -33.17%

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their net margin against the Software & Services industry group benchmark.

Operating Margin (TTM)

Cadence Design Systems (CDNS) at 28.93% operates in the top operating margin quartile, ahead of IBM (IBM) at 16.97%, which runs around its industry’s norm.

CDNS

Software & Services industry group

28.93%

Max: 46.89%
CDNS: 28.93%
Q3: 17.64%
Median: 8.73%
Q1: -2.13%
Min: -30.45%

IBM

Software & Services industry group

16.97%

Max: 46.89%
Q3: 17.64%
IBM: 16.97%
Median: 8.73%
Q1: -2.13%
Min: -30.45%

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their operating margin against the Software & Services industry group benchmark.

Profitability Metrics

Profitability metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
ROE (TTM)	22.87%	34.77%
ROA (TTM)	10.52%	5.33%
Net Margin (TTM)	22.52%	15.99%
Operating Margin (TTM)	28.93%	16.97%
Gross Margin (TTM)	85.68%	57.97%

Growth

Revenue Growth

Both Cadence Design Systems (CDNS) at 14.12% and IBM (IBM) at 7.62% land near their industries' usual revenue growth ranges, so top-line momentum looks broadly in line with peers on both sides.

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their Revenue Growth across different time periods.

EPS Growth

IBM (IBM) at 73.72% sits in the top EPS growth quartile, while Cadence Design Systems (CDNS) at 5.45% is closer to the peer norm — faster per-share earnings growth for IBM.

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their EPS Growth across different time periods.

Growth Metrics

Growth metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Revenue Growth (YoY)	14.12%	7.62%
Revenue Growth (3Y CAGR)	14.14%	3.72%
EPS Growth (YoY)	5.45%	73.72%
EPS Growth (3Y CAGR)	9.53%	83.76%

Financial Strength

Current Ratio (MRQ)

Cadence Design Systems (CDNS) at 1.36 keeps current ratio within its industry’s typical mid-range, while IBM (IBM) at 0.86 runs in the tighter-liquidity quartile — a thinner cushion against current liabilities for IBM.

CDNS

Software & Services industry group

1.36

Max: 5.11
Q3: 2.77
Median: 1.67
CDNS: 1.36
Q1: 1.01
Min: 0.03

IBM

Software & Services industry group

0.86

Max: 5.11
Q3: 2.77
Median: 1.67
Q1: 1.01
IBM: 0.86
Min: 0.03

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their current ratio against the Software & Services industry group benchmark.

Debt / Equity (MRQ)

Cadence Design Systems (CDNS) at 0.41 carries an industry-typical debt-to-equity mix, while IBM (IBM) at 1.85 uses more debt funding than most peers.

CDNS

Software & Services industry group

0.41

Max: 2.52
Q3: 1.13
CDNS: 0.41
Median: 0.40
Q1: 0.07
Min: 0.00

IBM

Software & Services industry group

1.85

Max: 2.52
IBM: 1.85
Q3: 1.13
Median: 0.40
Q1: 0.07
Min: 0.00

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their debt-to-equity ratio against the Software & Services industry group benchmark.

Financial Strength Metrics

Financial strength metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Current Ratio (MRQ)	1.36	0.86
Debt / Equity (MRQ)	0.41	1.85
Net Debt / EBITDA	0.57	3.37

Dividends

Dividend Yield (TTM)

Cadence Design Systems (CDNS) pays no dividend (yield 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a yield of 2.73%, ranking against industry peers normally.

CDNS

Software & Services industry group

0.00%

CDNS: 0.00%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

IBM

Software & Services industry group

2.73%

IBM: 2.73%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their dividend yield against the Software & Services industry group benchmark.

Dividend Payout Ratio (TTM)

Cadence Design Systems (CDNS) pays no dividend (payout 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a payout of 57.51%, ranking against industry peers normally.

CDNS

Software & Services industry group

0.00%

CDNS: 0.00%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

IBM

Software & Services industry group

57.51%

IBM: 57.51%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their payout ratio against the Software & Services industry group benchmark.

Dividend Metrics

Dividend metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
Dividend Yield (TTM)	0.00%	2.73%
Dividend Payout Ratio (TTM)	0.00%	57.51%

Valuation

P/E Ratio (TTM)

IBM (IBM) at 20.90 is near its industry’s usual P/E ratio, while Cadence Design Systems (CDNS) at 63.60 sits in the richer quartile — CDNS needs stronger growth or earnings quality to justify the premium.

CDNS

Software & Services industry group

63.60

Max: 112.94
CDNS: 63.60
Q3: 60.32
Median: 32.91
Q1: 18.77
Min: 6.69

IBM

Software & Services industry group

20.90

Max: 112.94
Q3: 60.32
Median: 32.91
IBM: 20.90
Q1: 18.77
Min: 6.69

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their P/E ratio against the Software & Services industry group benchmark.

P/S Ratio (TTM)

IBM (IBM) at 3.31 is priced about in line with its industry on P/S ratio, while Cadence Design Systems (CDNS) at 14.31 sits in the pricier quartile — CDNS costs more per dollar of sales.

CDNS

Software & Services industry group

14.31

Max: 17.91
CDNS: 14.31
Q3: 8.78
Median: 4.25
Q1: 2.23
Min: 0.02

IBM

Software & Services industry group

3.31

Max: 17.91
Q3: 8.78
Median: 4.25
IBM: 3.31
Q1: 2.23
Min: 0.02

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their P/S ratio against the Software & Services industry group benchmark.

P/B Ratio (MRQ)

IBM (IBM) at 6.52 is valued about in line with its industry on P/B ratio, while Cadence Design Systems (CDNS) at 12.77 carries an above-peer premium to book — CDNS is pricier on assets.

CDNS

Software & Services industry group

12.77

Max: 16.63
CDNS: 12.77
Q3: 8.50
Median: 4.30
Q1: 1.92
Min: -3.90

IBM

Software & Services industry group

6.52

Max: 16.63
Q3: 8.50
IBM: 6.52
Median: 4.30
Q1: 1.92
Min: -3.90

Cadence Design Systems (CDNS) vs. IBM (IBM): A comparison of their P/B ratio against the Software & Services industry group benchmark.

Valuation Metrics

Valuation metrics for Cadence Design Systems (CDNS) and IBM (IBM)
Metric	CDNS	IBM
P/E Ratio (TTM)	63.60	20.90
P/S Ratio (TTM)	14.31	3.31
P/B Ratio (MRQ)	12.77	6.52
Free Cash Flow Yield (TTM)	1.99%	5.34%