Cadence Design SystemsMEX:CDNS 96 Pretax Margin % is 29.04% as of Mar. 2026, which is 18% above its 10-year median of 24.65. GuruFocus rates MEX:CDNS with a GF Score™ of 96/100 and a GF Value™ of MXN6,598.80 (Fairly Valued). The stock has 4 warning signs investors should review. Among 2,822 Software companies, Cadence Design Systems ranks better than 92.98% on this metric.
The historical rank and industry rank for Cadence Design Systems's Pretax Margin % or its related term are showing as below:
MEX:CDNS'
s Pretax Margin % Range Over the Past 10 Years
Min: 13.06 Med: 24.65 Max: 31.34
Current: 28.84
MEX:CDNS's Pretax Margin % is ranked better than 92.98% of 2822
companies
in the Software industry
Industry Median: 3.5
vs MEX:CDNS: 28.84
Cadence Design Systems (MEX:CDNS) Pretax Margin % Explanation
The pretax margin, as know as pretax profit margin, is widely used to measure the operating efficiency of a company before deducting taxes.
The pretax margin is sometimes preferred over the net margin as tax expenditures can make profitability comparisons between companies misleading.
It is a useful tool to compare companies operating in the same sector and less effective when comparing companies from other sectors as each industry generally has different operating expenses and sales patterns.
The long term trend of the pretax margin is a good indicator of the competitiveness and health of the business.
Cadence Design Systems Pretax Margin % Related Terms
Cadence Design Systems Pretax Margin % Historical Data
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The historical data trend for Cadence Design Systems's Pretax Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
MEX:CDNS vs ADBE, INTU, ADP: Pretax Margin % Comparison
For the Software - Application subindustry, Cadence Design Systems's Pretax Margin %, along with its competitors' market caps and Pretax Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Cadence Design Systems Pretax Margin % vs Software Industry
For the Software industry and Technology sector, Cadence Design Systems's Pretax Margin % distribution charts can be found below:
* The bar in red indicates where Cadence Design Systems's Pretax Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Cadence Design Systems (MEX:CDNS) has a Pretax Margin % of 29.04% as of Mar. 2026. Pre-Tax margin is the ratio of total pre-tax income to net sales. View historical data on Cadence Design Systems and its competitors. This is 18% above median its historical median of 24.65. Over the past decade, Cadence Design Systems' Pretax Margin % has ranged from 13.06 to 31.34. According to the industry distribution chart, Cadence Design Systems ranks #198 out of 2822 companies in the Software industry, placing it in the top 7%.
Is Cadence Design Systems' Pretax Margin % too high?
Cadence Design Systems' current Pretax Margin % of 29.04% is 18% above median its 10-year median of 24.65. Over the past 10 years, this metric has ranged from a low of 13.06 to a high of 31.34. The Software industry median Pretax Margin % is 3.50. Cadence Design Systems' value of 29.04% is 729.7% above this industry median. Based on the distribution chart, Cadence Design Systems ranks #198 out of 2822 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Cadence Design Systems has a GF Score™ of 96/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Cadence Design Systems' Pretax Margin % compare to ADBE and INTU?
According to the Software industry distribution chart, Cadence Design Systems ranks #198 out of 2822 companies for Pretax Margin %. This places Cadence Design Systems in the top 7% of its industry — outperforming the majority of peers. The industry median Pretax Margin % is 3.50. Cadence Design Systems' value of 29.04% is 729.7% above this benchmark. Historically, Cadence Design Systems' own Pretax Margin % has ranged from 13.06 to 31.34 over the past decade. While the company's 10-year median is 24.65 vs. the industry median of 3.50, Cadence Design Systems has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Pretax Margin % for a Software company?
The median Pretax Margin % among Software companies is 3.50, based on 2,822 companies in the industry. Companies in the top quartile (top 25%) have a Pretax Margin % significantly above this median, while those in the bottom quartile fall well below. However, Pretax Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Cadence Design Systems's current Pretax Margin % of 29.04% is 729.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Pretax Margin % mean?
A high Pretax Margin % can signal that a stock is expensive relative to its fundamentals. Pre-Tax margin is the ratio of total pre-tax income to net sales. View historical data on Cadence Design Systems and its competitors. For the Software industry, the median Pretax Margin % is 3.50 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cadence Design Systems's current Pretax Margin % is 29.04%, which is 18% above median its own 10-year median of 24.65. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cadence Design Systems stock overvalued right now?
Based on GuruFocus' analysis, Cadence Design Systems (MEX:CDNS) is currently considered Fairly Valued. The stock's GF Value™ is MXN6,598.80, compared to a current price of MXN6,603.00 — trading 0.1% above its estimated fair value. The current Pretax Margin % is 29.04%, which is 18% above median its 10-year median of 24.65 and 729.7% above the Software industry median of 3.50. Cadence Design Systems' overall GF Score™ is 96/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Pretax Margin % calculated?
Pretax Margin % is calculated from a company's financial statements. For Cadence Design Systems (MEX:CDNS), the current Pretax Margin % is 29.04% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Cadence Design Systems (MEX:CDNS) Overvalued in 2026?
Based on GuruFocus' analysis, Cadence Design Systems stock appears to be overvalued.
The current stock price of MXN6,603.00 is trading 0.1% above its estimated GF Value™ of MXN6,598.80.
GuruFocus considers Cadence Design Systems to be Fairly Valued.
Key valuation signals for MEX:CDNS:
Pretax Margin %: 29.04% (18% above median its 10-year median of 24.65)
GF Value™: MXN6,598.80 vs. price of MXN6,603.00 (0.1% above fair value)
Industry Position: 729.7% above the Software median (#198 of 2822)
No single metric tells the full story. See the MEX:CDNS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Cadence Design Systems is a provider of electronic design automation software, intellectual property, and system design and analysis products. EDA software automates and aids in the chip design process, enhancing design accuracy, productivity, and complexity in a full-flow end-to-end solution. Cadence offers a portfolio of design IP, as well as system design and analysis products, which enables system-level analysis and verification solutions.
96GF Score
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