Jim Cramer on Super Micro Computer and Other Stocks

2. Cadence Design Systems, Inc. (NASDAQ:CDNS)

Number of Hedge Fund Holders: 64

Cadence Design Systems, Inc. (NASDAQ:CDNS) is a provider of software, hardware, services, and reusable integrated circuit (IC) design blocks on a global scale. The company specializes in offering functional verification services through its platforms. In addition, it supports digital IC design with tools like Genus synthesis and Modus DFT software, as well as solutions for physical implementation. When a caller asked Cramer if they should stay long with the stock or take a quick profit, he said:

“Not an issue. Stay long [on] it. I just checked in with them again. I think they’re doing incredibly well. Cadence is a winner. Stay long [on] it. Buy some more.”

In recent years, Cadence Design Systems (NASDAQ:CDNS) has seen a notable acceleration in revenue, driven in part by the growing interest from major cloud companies in developing their own chip designs. In the second quarter, the company reported a revenue increase of 9%, reaching $1.06 billion.

Meanwhile, adjusted EPS rose by 1.2% to $1.28, slightly surpassing market expectations. While these growth figures may seem subdued compared to the past few years, they still show a positive trajectory. Furthermore, Cadence Design Systems (NASDAQ:CDNS) adjusted its revenue guidance upward, now forecasting a growth rate of 13% for the year. However, the company also revised its adjusted EPS expectations downward due to increased investments.