AVGO vs CDNS Stock Comparison: AI Score, Valuation, Performance and Upside
Broadcom is generally evaluated as a direct, large-scale participant in AI infrastructure through custom silicon and networking, layered with diversified software cash flow, while Cadence is judged as a picks-and-shovels software provider that benefits from rising chip design complexity across the entire semiconductor industry, including AI chips. The comparison often comes down to direct AI hardware exposure versus indirect, software-tollbooth exposure to the same trend.
Use this AVGO vs CDNS comparison to weigh direct AI silicon and infrastructure exposure against indirect, software-based exposure to the same secular chip-design trend: Broadcom offers scale and diversification within AI hardware, while Cadence offers high-margin recurring revenue tied to the tools used to design that hardware.
AVGO holds the edge across 4 of 5 key metrics in this comparison. CDNS has delivered stronger 1-year price return (+0.09% vs -1.99%), though AVGO has the better forward P/E setup (18.67x vs 35.67x for CDNS). AVGO leads on both revenue growth (85.50%) and operating margin (54.31%), suggesting a stronger fundamental setup on both dimensions. Analyst consensus implies meaningfully more upside for AVGO (+46.92%) than for CDNS (+18.43%).
Human Wall Street analysts' price targets, typically implying a ~12-month view — a separate signal from this site's own AI Prediction Signal further down the page, which is a 5-/30-day machine-learning forecast based on price history alone.
- Want direct exposure to custom AI accelerator and networking silicon growth
- Value diversified cash flow from both semiconductors and enterprise software
- Believe multi-year hyperscaler partnerships provide revenue visibility
- Prefer mega-cap scale within AI infrastructure investing
- Prefer indirect, tollbooth-style exposure to rising chip design complexity
- Value high-margin, recurring subscription software revenue
- Believe AI chip development will keep driving EDA tool demand
- Want a lower customer-concentration profile than pure AI hardware plays
| Metric | AVGO | CDNS |
|---|---|---|
| AI scorei | 76.3 | 60.8 |
| AI ranki | #17 | #127 |
| Latest closei | $344.33 | $324.38 |
| 1M returni | +1.49% | +18.40% |
| 3M returni | -8.04% | -11.04% |
| 6M returni | -13.59% | +5.68% |
| 1Y returni | -1.99% | +0.09% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | AVGO | CDNS |
|---|---|---|
| 1Y ago | $9.72K (-2.8%) started 2025-10-16 | $10K (+0.0%) started 2025-10-16 |
| 5Y ago | $80.01K (+700.1%) started 2021-10-18 | $20.59K (+105.9%) started 2021-10-18 |
| 10Y ago | $349.75K (+3397.5%) started 2016-10-17 | $125K (+1150.0%) started 2016-10-17 |
Hypothetical — past performance does not guarantee future results.
| Metric | AVGO | CDNS |
|---|---|---|
| Market capi | $1.73T | $93.74B |
| Trailing P/Ei | 46.05 | 67.54 |
| Forward P/Ei | 18.67 | 35.67 |
| Price/Salesi | N/A | 16.63 |
| EV/Revenuei | 19.79 | 16.25 |
| Analyst targeti | $531.85 | $403.12 |
| Target upsidei | +46.92% | +18.43% |
| Metric | AVGO | CDNS |
|---|---|---|
| Revenue growthi | 85.50% | 24.20% |
| Earnings growthi | 215.30% | 125.40% |
| EPS growthi | +215.30% | +125.40% |
| FCF margini | +34.34% | +27.57% |
| Operating margini | 54.31% | 28.57% |
| Profit margini | 42.94% | 23.61% |
| ROIC proxyi | 44.25% | 23.23% |
| Return on equityi | 44.25% | 23.23% |
| Dividend yieldi | 0.72% | N/A |
| Payout ratioi | 32.44% | 0.00% |
| Dividend growth streaki | No increase yet | N/A |
| Betai | 1.46 | 1.14 |
| Debt/equityi | 59.60 | 38.66 |
| Current ratioi | 2.50 | 1.74 |
| Quick ratioi | 2.15 | 1.43 |
Over the past year, AVGO and CDNS have moved weakly in the same direction (correlation of 0.33), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | AVGO | CDNS |
|---|---|---|---|
| 1Y | Growthi | -2.77% | +0.04% |
| CAGRi | -2.78% | +0.04% | |
| Volatilityi | 45.41% | 40.34% | |
| Sharpe ratioi | 0.07 | 0.09 | |
| Sortino ratioi | 0.09 | 0.13 | |
| Max drawdowni | 29.55% | 34.21% | |
| Current drawdowni | 28.50% | 22.10% | |
| Avg drawdowni | 15.61% | 13.19% | |
| Ulcer Indexi | 17.94% | 15.41% | |
| Max daily dropi | 12.59% | 9.47% | |
| Max wkly dropi | 22.35% | 16.14% | |
| 5Y | Growthi | +638.77% | +105.90% |
| CAGRi | +49.24% | +15.56% | |
| Volatilityi | 44.47% | 37.20% | |
| Sharpe ratioi | 1.02 | 0.45 | |
| Sortino ratioi | 1.60 | 0.67 | |
| Max drawdowni | 41.15% | 34.21% | |
| Current drawdowni | 28.50% | 22.10% | |
| Avg drawdowni | 10.96% | 10.94% | |
| Ulcer Indexi | 14.23% | 13.71% | |
| Max daily dropi | 17.40% | 10.67% | |
| Max wkly dropi | 22.35% | 17.15% | |
| 10Y | Growthi | +2526.27% | +1150.02% |
| CAGRi | +38.67% | +28.74% | |
| Volatilityi | 39.96% | 34.63% | |
| Sharpe ratioi | 0.91 | 0.77 | |
| Sortino ratioi | 1.36 | 1.15 | |
| Max drawdowni | 48.30% | 34.21% | |
| Current drawdowni | 28.50% | 22.10% | |
| Avg drawdowni | 8.81% | 8.26% | |
| Ulcer Indexi | 12.13% | 11.22% | |
| Max daily dropi | 19.91% | 12.60% | |
| Max wkly dropi | 31.75% | 18.83% |
| Category | AVGO | CDNS |
|---|---|---|
| Company | Broadcom Inc. | Cadence Design Systems, Inc. |
| Sector | Technology | Technology |
| Industry | Semiconductors | Software - Application |
| Core business | Broadcom designs custom AI accelerators (XPUs) and networking silicon for hyperscalers, alongside a large enterprise infrastructure software business built substantially through the VMware acquisition. | Cadence provides electronic design automation software, IP, and hardware-based verification systems used by semiconductor and systems companies to design chips, including the advanced silicon powering AI infrastructure. |
| Investor focus | Investors focus on Broadcom's custom AI silicon backlog and hyperscaler partnerships, networking chip growth, and cash flow contribution from its software segment. | Investors watch Cadence's recurring software revenue growth, demand for advanced-node and AI-chip design tools, and competitive dynamics against Synopsys. |
- Deep, multi-year custom AI accelerator partnerships with major hyperscale customers
- Large, diversified revenue base spanning semiconductors and enterprise software
- Strong free cash flow generation supporting dividends and buybacks
- Essential, high-switching-cost software used across the semiconductor design industry
- Direct beneficiary of rising design complexity driven by AI chip development
- High-margin, largely recurring subscription-based revenue model
- High customer concentration risk in its custom AI silicon business
- Integration and growth execution risk tied to the large VMware acquisition
- Elevated valuation multiple pricing in continued AI-driven growth
- Revenue concentration in a duopoly-like EDA market alongside Synopsys
- Exposure to semiconductor industry R&D spending cycles and export control policy
- Premium valuation multiple typical of high-quality recurring-revenue software names
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