CADENCE DESIGN SYSTEMS, INC. vs Shopify Inc., two Software stocks. A side-by-side on valuation, growth, margins, returns, and what each price is betting.
Shopify keeps under half of each sales dollar as gross profit, a 49% gross margin that reflects the payments and logistics it carries, where Cadence's lighter software model leaves a 21% net margin to Shopify's 11%. Top-line growth is not in these numbers, so the market's read shows up instead in the multiples it assigns, and both are priced for plenty of it: Shopify near 106 times trailing earnings, Cadence near 90. Both run debt-free, Shopify with a fat current ratio of 6.2 to Cadence's 1.5, and both convert only a thin slice of price into free cash, roughly 1.5% each. Cadence earns more on equity, 18% to Shopify's 11%, while the two earn about the same on assets, near 9.5%. Buyers of either are paying today for revenue they expect tomorrow.
Comparison updated 2026-06-15.
| Metric | CDNS | SHOP |
|---|---|---|
| Price | $384.25 | $122.50 |
| Market cap | $105.2B | $159.7B |
| Sector | Software | Software |
| Stage | Mature | Growth |
| P/E | 89.6 | — |
| P/B | 16.03 | — |
| P/S | 19.02 | — |
| EV/EBITDA | 63.0 | — |
| Revenue growth | +13.8% | +31.9% |
| Gross margin | — | 48.8% |
| Operating margin | 29.3% | 12.1% |
| Net margin | 21.2% | 10.8% |
| Return on equity | 17.9% | 10.7% |
| Return on assets | 9.7% | 9.4% |
| Return on invested capital | 18.7% | 10.4% |
| FCF yield | 1.4% | — |
| Debt / equity | 0.00 | 0.00 |
| Current ratio | 1.47 | 6.20 |
| Altman Z (solvency) | 7.54 | 7.80 |
| Piotroski F (quality) | 6 / 9 | 6 / 9 |
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The stronger value is highlighted per metric where one is strictly better on that single number; it is not an overall verdict on either company. For informational and research purposes only. Not investment advice. Not a recommendation to buy, sell, or hold any security. boothcheck is not a registered investment adviser. Past performance does not guarantee future results.