Cadence Design SystemsXSWX:CDNS 99 ROC (Joel Greenblatt) % is 296.99% as of Mar. 2026, which is 76% above its 10-year median of 168.83. GuruFocus rates XSWX:CDNS with a GF Score™ of 99/100 and a GF Value™ of CHF314.60. The stock has 4 warning signs investors should review. Among 2,807 Software companies, Cadence Design Systems ranks better than 89.53% on this metric.
Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits). He defines ROC (Joel Greenblatt) % as EBIT divided by the total of Property, Plant and Equipment and net working capital. Cadence Design Systems's annualized ROC (Joel Greenblatt) % for the quarter that ended in Mar. 2026 was 296.99%.
The historical rank and industry rank for Cadence Design Systems's ROC (Joel Greenblatt) % or its related term are showing as below:
XSWX:CDNS'
s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: 111.65 Med: 168.83 Max: 320.52
Current: 320.52
During the past 13 years, Cadence Design Systems's highest ROC (Joel Greenblatt) % was 320.52%. The lowest was 111.65%. And the median was 168.83%.
XSWX:CDNS's ROC (Joel Greenblatt) % is ranked better than 89.53% of 2807
companies
in the Software industry
Industry Median: 19.62
vs XSWX:CDNS: 320.52
Cadence Design Systems's 5-Year average Growth Rate of ROC (Joel Greenblatt) % was 10.40% per year.
Cadence Design Systems (XSWX:CDNS) ROC (Joel Greenblatt) % Explanation
The way Joel Greenblatt defines Return on Capital is a more accurate measure of how efficiently the company generates returns onthe capital actually invested in the business. EBIT is used instead of net income because the tax and interest payment may be affected by factors other than the core business operation. Intangible assets are not included in the calculation because they don't need to be replaced.
Cadence Design Systems ROC (Joel Greenblatt) % Related Terms
Cadence Design Systems ROC (Joel Greenblatt) % Historical Data
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The historical data trend for Cadence Design Systems's ROC (Joel Greenblatt) % 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.
Cadence Design Systems ROC (Joel Greenblatt) % Chart
For the Software - Application subindustry, Cadence Design Systems's ROC (Joel Greenblatt) %, along with its competitors' market caps and ROC (Joel Greenblatt) % 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 ROC (Joel Greenblatt) % vs Software Industry
For the Software industry and Technology sector, Cadence Design Systems's ROC (Joel Greenblatt) % distribution charts can be found below:
* The bar in red indicates where Cadence Design Systems's ROC (Joel Greenblatt) % falls into.
Cadence Design Systems ROC (Joel Greenblatt) % Calculation
Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits) . He defines Return on Capital as follows:
EBIT stands for Earnings Before Interest and Taxes.
Fixed Assets are also known as non-current assets. They include the Property, Plant and Equipment that the firm needs in its operation.
GuruFocus calculates net working capital as: (Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Deferred Revenue + Other Current Liabilities). We're trying to account for OPERATING assets and liabilities (part of daily business) when calculating working capital. Cash and marketable securities are considered NON-OPERATING assets and are not included in calculation. We will also back out all interest bearing debt, short term debt and the portion of long term debt that is due in the current period from the current liabilities. This debt will be considered when computing cost of capital and it would be inappropriate to count it twice.
Note:
The EBIT data used here is four times the quarterly (Mar. 2026) EBIT data.
* 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.
What does a ROC (Joel Greenblatt) % of 296.99% mean?
Cadence Design Systems (XSWX:CDNS) has a ROC (Joel Greenblatt) % of 296.99% as of Mar. 2026. Joel Greenblatt's return on capital is the ratio of EBIT to average fixed assets and net working capital. View historical data on Cadence Design Systems and its competitors. This is 76% above median its historical median of 168.83. Over the past decade, Cadence Design Systems' ROC (Joel Greenblatt) % has ranged from 111.65 to 320.52. According to the industry distribution chart, Cadence Design Systems ranks #294 out of 2807 companies in the Software industry, placing it in the top 10.5%.
Is Cadence Design Systems' ROC (Joel Greenblatt) % too high?
Cadence Design Systems' current ROC (Joel Greenblatt) % of 296.99% is 76% above median its 10-year median of 168.83. Over the past 10 years, this metric has ranged from a low of 111.65 to a high of 320.52. The Software industry median ROC (Joel Greenblatt) % is 19.62. Cadence Design Systems' value of 296.99% is 1413.7% above this industry median. Based on the distribution chart, Cadence Design Systems ranks #294 out of 2807 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 99/100, reflecting its overall financial health beyond just this single metric.
How does Cadence Design Systems' ROC (Joel Greenblatt) % compare to ?
According to the Software industry distribution chart, Cadence Design Systems ranks #294 out of 2807 companies for ROC (Joel Greenblatt) %. This places Cadence Design Systems in the top 11% of its industry — outperforming the majority of peers. The industry median ROC (Joel Greenblatt) % is 19.62. Cadence Design Systems' value of 296.99% is 1413.7% above this benchmark. Historically, Cadence Design Systems' own ROC (Joel Greenblatt) % has ranged from 111.65 to 320.52 over the past decade. While the company's 10-year median is 168.83 vs. the industry median of 19.62, 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 ROC (Joel Greenblatt) % for a Software company?
The median ROC (Joel Greenblatt) % among Software companies is 19.62, based on 2,807 companies in the industry. Companies in the top quartile (top 25%) have a ROC (Joel Greenblatt) % significantly above this median, while those in the bottom quartile fall well below. However, ROC (Joel Greenblatt) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Cadence Design Systems's current ROC (Joel Greenblatt) % of 296.99% is 1413.7% 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 ROC (Joel Greenblatt) % mean?
A high ROC (Joel Greenblatt) % can signal that a stock is expensive relative to its fundamentals. Joel Greenblatt's return on capital is the ratio of EBIT to average fixed assets and net working capital. View historical data on Cadence Design Systems and its competitors. For the Software industry, the median ROC (Joel Greenblatt) % is 19.62 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cadence Design Systems's current ROC (Joel Greenblatt) % is 296.99%, which is 76% above median its own 10-year median of 168.83. 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?
Cadence Design Systems (XSWX:CDNS) has a current ROC (Joel Greenblatt) % of 296.99%. The stock's GF Value™ is CHF314.60, compared to a current price of CHF310.65 — trading 1.3% below its estimated fair value. The current ROC (Joel Greenblatt) % is 296.99%, which is 76% above median its 10-year median of 168.83 and 1413.7% above the Software industry median of 19.62. Cadence Design Systems' overall GF Score™ is 99/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC (Joel Greenblatt) % calculated?
ROC (Joel Greenblatt) % is calculated from a company's financial statements. For Cadence Design Systems (XSWX:CDNS), the current ROC (Joel Greenblatt) % is 296.99% 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 (XSWX:CDNS) Overvalued in 2026?
Based on GuruFocus' analysis, Cadence Design Systems stock appears to be undervalued.
The current stock price of CHF310.65 is trading 1.3% below its estimated GF Value™ of CHF314.60.
Key valuation signals for XSWX:CDNS:
ROC (Joel Greenblatt) %: 296.99% (76% above median its 10-year median of 168.83)
GF Value™: CHF314.60 vs. price of CHF310.65 (1.3% below fair value)
Industry Position: 1413.7% above the Software median (#294 of 2807)
No single metric tells the full story. See the XSWX: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.
99GF Score
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