Reviewing Cadence Design Systems (NASDAQ:CDNS) & Elcom International (OTCMKTS:ELCO)

Cadence Design Systems (NASDAQ:CDNS) and Elcom International (OTCMKTS:ELCO) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Cadence Design Systems has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500. Comparatively, Elcom International has a beta of 0.07, suggesting that its share price is 93% less volatile than the S&P 500.

Profitability

This table compares Cadence Design Systems and Elcom International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cadence Design Systems	19.88%	29.65%	15.38%
Elcom International	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Cadence Design Systems and Elcom International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cadence Design Systems	1	3	14	0	2.72
Elcom International	0	0	0	0	0.00

Cadence Design Systems currently has a consensus target price of $368.53, suggesting a potential upside of 6.67%. Given Cadence Design Systems’ stronger consensus rating and higher possible upside, analysts plainly believe Cadence Design Systems is more favorable than Elcom International.

Insider and Institutional Ownership

84.9% of Cadence Design Systems shares are held by institutional investors. 0.4% of Cadence Design Systems shares are held by company insiders. Comparatively, 13.6% of Elcom International shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Cadence Design Systems and Elcom International”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cadence Design Systems	$4.64 billion	20.28	$1.06 billion	$3.70	93.37
Elcom International	N/A	N/A	N/A	N/A	N/A

Cadence Design Systems has higher revenue and earnings than Elcom International.

Summary

Cadence Design Systems beats Elcom International on 9 of the 10 factors compared between the two stocks.

About Cadence Design Systems

Cadence Design Systems, Inc. provides software, hardware, services, and reusable integrated circuit (IC) design blocks worldwide. The company offers functional verification services, including emulation and prototyping hardware. Its functional verification offering consists of JasperGold, a formal verification platform; Xcelium, a parallel logic simulation platform; Palladium, an enterprise emulation platform; and Protium, a prototyping platform for chip verification. The company also provides digital IC design and sign off products, including Genus synthesis and Joules RTL power solutions, as well as Modus DFT software solution to reduce systems-on-chip design-for-test time; physical implementation tools, such as place and route, optimization, and multiple patterning preparation; and Innovus implementation system, a physical implementation system. In addition, it offers custom IC design and simulation products to create schematic and physical representations of circuits down to the transistor level for analog, mixed-signal, custom digital, memory, and radio frequency designs; and system design and analysis products to develop printed circuit boards and IC packages, as well as to analyze electromagnetic, electro-thermal, and other multi-physics effects. Further, the company provides intellectual property (IP) products comprising pre-verified and customizable functional blocks to integrate into customer's ICs; and verification IP with memory models to emulate and model the expected behavior and interaction of standard industry system interface protocols. Additionally, it offers services related to methodology, education, and hosted design solutions, as well as technical support and maintenance services. The company serves consumer, hyperscale computing, 5G communications, mobile, automotive, aerospace and defense, industrial, and life science industries. Cadence Design Systems, Inc. was incorporated in 1987 and is headquartered in San Jose, California.

About Elcom International

Elcom International Inc. provides cloud based e-procurement solutions worldwide. It offers Procure to Pay solutions to publish and manage supplier content, connect to buyers, and analyze spend and procurement processes; eInvoicing solutions to send and receive eInvoices with supplier adoption guaranteed; and sourcing functions to investigate potential suppliers on a local and global basis. The company also provides services for buyers, including catalog processing, development of punchout catalogs, and to integrate Elcom’s PECOS solution into existing purchasing processes; and services for suppliers, such as onboarding of new suppliers to utilize the solution, access to demand generating activities, and to access information and bids that relate to products and services. It offers eProcurement solutions for governments, educational institutions, healthcare organizations, private enterprises, buying groups. Elcom International Inc. was founded in 1992 and is based in Braintree, Massachusetts.