CDNS vs. MSFT: Cadence Design Systems vs. Microsoft Stock Comparison

November 11, 2026

How do Cadence Design Systems (CDNS) and Microsoft (MSFT) 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 Microsoft (MSFT) both belong to the Software industry, though CDNS is classified under Application Software while MSFT falls under Systems Software.

Company profile comparison for Cadence Design Systems (CDNS) and Microsoft (MSFT)
Profile Item	CDNS	MSFT
Name	Cadence Design Systems, Inc.	Microsoft Corporation Common Stock
Country/Region	United States	United States
GICS Sector	Information Technology	Information Technology
GICS Industry Group	Software & Services	Software & Services
GICS Industry	Software	Software
GICS Sub-Industry	Application Software	Systems Software
Market Capitalization	87.78 billion USD	3,940.41 billion USD
Currency	USD	USD
Exchange	Nasdaq	Nasdaq
Listing Date	June 10, 1987	March 13, 1986
Security Type	Common Stock	Common Stock

Price Performance

Cumulative Growth

CDNS

MSFT

GSPC

Cadence Design Systems (CDNS) vs. Microsoft (MSFT), 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

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

Calendar-Year Returns

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Calendar-year total returns for Cadence Design Systems (CDNS) and Microsoft (MSFT). 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 Microsoft (MSFT)
Metric	CDNS	MSFT
Total Return (1Y)	3.07%	10.30%
Total Return (3Y, Annualized)	9.32%	15.53%
Total Return (5Y, Annualized)	12.93%	11.01%

Risk Profile

Drawdown History

CDNS

MSFT

GSPC

Cadence Design Systems (CDNS) vs. Microsoft (MSFT), 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

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Distribution of monthly total returns for Cadence Design Systems (CDNS) and Microsoft (MSFT). 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 Microsoft (MSFT)
Metric	CDNS	MSFT
Volatility (1Y, Annualized)	42.21%	33.91%
Beta (5Y)	1.09	1.03
Max Drawdown (5Y)	-34.21%	-37.15%
Avg. Volume (3M)	2.41M	22.95M

Risk-Adjusted Performance

Risk-Return Positioning

CDNS and MSFT 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 Microsoft (MSFT)
Metric	CDNS	MSFT
Sharpe Ratio (1Y)	-0.03	0.18
Sortino Ratio (1Y)	-0.04	0.28

Profitability

ROE (TTM)

Both Cadence Design Systems (CDNS) at 22.87% and Microsoft (MSFT) at 34.22% 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%

MSFT

Software & Services industry group

34.22%

Max: 53.85%
MSFT: 34.22%
Q3: 17.90%
Median: 6.59%
Q1: -9.59%
Min: -50.52%

Cadence Design Systems (CDNS) vs. Microsoft (MSFT): 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 Microsoft (MSFT) at 41.17% 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%

MSFT

Software & Services industry group

41.17%

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

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

Operating Margin (TTM)

Microsoft (MSFT) at 49.76% shows unusually strong operating efficiency — above its industry’s operating margin range — and Cadence Design Systems (CDNS) at 28.93% also operates in the top quartile.

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%

MSFT

Software & Services industry group

49.76%

MSFT: 49.76%
Max: 46.89%
Q3: 17.64%
Median: 8.73%
Q1: -2.13%
Min: -30.45%

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

Profitability Metrics

Profitability metrics for Cadence Design Systems (CDNS) and Microsoft (MSFT)
Metric	CDNS	MSFT
ROE (TTM)	22.87%	34.22%
ROA (TTM)	10.52%	14.41%
Net Margin (TTM)	22.52%	41.17%
Operating Margin (TTM)	28.93%	49.76%
Gross Margin (TTM)	85.68%	67.66%

Growth

Revenue Growth

Both Cadence Design Systems (CDNS) at 14.12% and Microsoft (MSFT) at 17.79% 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. Microsoft (MSFT): A comparison of their Revenue Growth across different time periods.

EPS Growth

Both Cadence Design Systems (CDNS) at 5.45% and Microsoft (MSFT) at 31.60% land near their industries' usual EPS growth ranges, so bottom-line momentum looks broadly in line with peers on both sides.

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

Growth Metrics

Growth metrics for Cadence Design Systems (CDNS) and Microsoft (MSFT)
Metric	CDNS	MSFT
Revenue Growth (YoY)	14.12%	17.79%
Revenue Growth (3Y CAGR)	14.14%	16.12%
EPS Growth (YoY)	5.45%	31.60%
EPS Growth (3Y CAGR)	9.53%	22.86%

Financial Strength

Current Ratio (MRQ)

Both Cadence Design Systems (CDNS) at 1.36 and Microsoft (MSFT) at 1.23 carry current ratio within their industries’ typical mid-ranges, suggesting balanced short-term liquidity relative to peers.

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

MSFT

Software & Services industry group

1.23

Max: 5.11
Q3: 2.77
Median: 1.67
MSFT: 1.23
Q1: 1.01
Min: 0.03

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

Debt / Equity (MRQ)

Both Cadence Design Systems (CDNS) at 0.41 and Microsoft (MSFT) at 0.28 fund their balance sheets with roughly industry-typical debt-to-equity mixes.

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

MSFT

Software & Services industry group

0.28

Max: 2.52
Q3: 1.13
Median: 0.40
MSFT: 0.28
Q1: 0.07
Min: 0.00

Cadence Design Systems (CDNS) vs. Microsoft (MSFT): 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 Microsoft (MSFT)
Metric	CDNS	MSFT
Current Ratio (MRQ)	1.36	1.23
Debt / Equity (MRQ)	0.41	0.28
Net Debt / EBITDA	0.57	0.34

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 Microsoft (MSFT) reports a yield of 0.69%, 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%

MSFT

Software & Services industry group

0.69%

MSFT: 0.69%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

Cadence Design Systems (CDNS) vs. Microsoft (MSFT): 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 Microsoft (MSFT) reports a payout of 19.00%, 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%

MSFT

Software & Services industry group

19.00%

MSFT: 19.00%
Max: 0.00%
Q3: 0.00%
Median: 0.00%
Q1: 0.00%
Min: 0.00%

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

Dividend Metrics

Dividend metrics for Cadence Design Systems (CDNS) and Microsoft (MSFT)
Metric	CDNS	MSFT
Dividend Yield (TTM)	0.00%	0.69%
Dividend Payout Ratio (TTM)	0.00%	19.00%

Valuation

P/E Ratio (TTM)

Microsoft (MSFT) at 27.69 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

MSFT

Software & Services industry group

27.69

Max: 112.94
Q3: 60.32
Median: 32.91
MSFT: 27.69
Q1: 18.77
Min: 6.69

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

P/S Ratio (TTM)

Both Cadence Design Systems (CDNS) at 14.31 and Microsoft (MSFT) at 11.37 command a richer price per dollar of sales than most peers, sitting in the upper P/S ratio quartile of their industries.

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

MSFT

Software & Services industry group

11.37

Max: 17.91
MSFT: 11.37
Q3: 8.78
Median: 4.25
Q1: 2.23
Min: 0.02

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

P/B Ratio (MRQ)

Microsoft (MSFT) at 8.38 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

MSFT

Software & Services industry group

8.38

Max: 16.63
Q3: 8.50
MSFT: 8.38
Median: 4.30
Q1: 1.92
Min: -3.90

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

Valuation Metrics

Valuation metrics for Cadence Design Systems (CDNS) and Microsoft (MSFT)
Metric	CDNS	MSFT
P/E Ratio (TTM)	63.60	27.69
P/S Ratio (TTM)	14.31	11.37
P/B Ratio (MRQ)	12.77	8.38
Free Cash Flow Yield (TTM)	1.99%	0.08%