Analyzing Cadence Design Systems (NASDAQ:CDNS) and ZIM (OTCMKTS:ZIMCF)

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

Volatility & Risk

Cadence Design Systems has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, ZIM has a beta of -0.48, indicating that its share price is 148% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Cadence Design Systems and ZIM, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cadence Design Systems	0	3	15	0	2.83
ZIM	0	0	0	0	0.00

Cadence Design Systems currently has a consensus price target of $376.50, indicating a potential upside of 41.72%. Given Cadence Design Systems’ stronger consensus rating and higher probable upside, analysts clearly believe Cadence Design Systems is more favorable than ZIM.

Insider & Institutional Ownership

84.9% of Cadence Design Systems shares are held by institutional investors. 2.0% of Cadence Design Systems shares are held by company insiders. Comparatively, 70.7% of ZIM shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Cadence Design Systems and ZIM”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cadence Design Systems	$5.30 billion	13.85	$1.11 billion	$4.06	65.43
ZIM	N/A	N/A	N/A	N/A	N/A

Cadence Design Systems has higher revenue and earnings than ZIM.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Cadence Design Systems	20.93%	29.34%	15.68%
ZIM	N/A	N/A	N/A

Summary

Cadence Design Systems beats ZIM 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 ZIM

ZIM Corporation provides software products and services for the database and mobile markets in the United States, Brazil, Canada, Singapore, and Austria. The company operates in two segments, Mobile and Enterprise Software. It develops and sells ZIM integrated development environment (IDE) software, an enterprise software for use in the design, development, and management of information databases and mission critical applications. The company’s ZIM IDE software provides an IDE for Microsoft Windows, UNIX, and Linux computer operating systems. Its products are used to develop database applications in various industries, including finance, insurance, marketing, human resource, information, and records management. The company also provides migration services and management products; and short message services. ZIM Corporation was founded in 1997 and is headquartered in Ottawa, Canada.