Cadence Stock Surges on AI-Powered Supercomputer for Faster Simulations
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Cadence Design Systems has seen its stock price surge nearly 60% over the past year. It recently announced a new AI-powered supercomputer for computational fluid dynamics.
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The new supercomputer uses Nvidia GPUs and is designed to simulate complex systems like car engines before physical prototypes are built.
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Cadence's innovation in this area gives it a competitive edge, while rival Synopsys is taking on debt to acquire simulation software provider Ansys.
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Cadence enjoys strong profit margins and a clean balance sheet compared to peers. However, its valuation remains expensive even after the recent stock run-up.
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While patience is warranted with Cadence stock in 2024, its AI and simulation capabilities make it a premium software vendor long-term.