Comparing Manhattan Associates (NASDAQ:MANH) and Cadence Design Systems (NASDAQ:CDNS)

Manhattan Associates (NASDAQ:MANH) and Cadence Design Systems (NASDAQ:CDNS) 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, dividends, analyst recommendations, risk, earnings, profitability and institutional ownership.

Insider and Institutional Ownership

98.5% of Manhattan Associates shares are owned by institutional investors. Comparatively, 84.9% of Cadence Design Systems shares are owned by institutional investors. 0.9% of Manhattan Associates shares are owned by insiders. Comparatively, 2.0% of Cadence Design Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Manhattan Associates	$1.08 billion	7.49	$219.95 million	$3.60	37.57
Cadence Design Systems	$5.30 billion	15.06	$1.11 billion	$4.06	71.16

Cadence Design Systems has higher revenue and earnings than Manhattan Associates. Manhattan Associates is trading at a lower price-to-earnings ratio than Cadence Design Systems, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Manhattan Associates has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500. Comparatively, Cadence Design Systems has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Manhattan Associates and Cadence Design Systems, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Manhattan Associates	0	5	8	0	2.62
Cadence Design Systems	0	3	15	0	2.83

Manhattan Associates currently has a consensus price target of $220.36, suggesting a potential upside of 62.91%. Cadence Design Systems has a consensus price target of $376.50, suggesting a potential upside of 30.31%. Given Manhattan Associates’ higher possible upside, equities research analysts plainly believe Manhattan Associates is more favorable than Cadence Design Systems.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Manhattan Associates	20.34%	75.61%	28.35%
Cadence Design Systems	20.93%	29.34%	15.68%

Summary

Cadence Design Systems beats Manhattan Associates on 9 of the 14 factors compared between the two stocks.

About Manhattan Associates

Manhattan Associates, Inc. develops, sells, deploys, services, and maintains software solutions to manage supply chains, inventory, and omni-channel operations. It offers Warehouse Management Solution for managing goods and information across the distribution centers; Manhattan Active Warehouse Management, a cloud native and version less application for the associate; and Transportation Management Solution for helping shippers navigate their way through the demands and meet customer service expectations at the lowest possible freight costs; Manhattan SCALE, a portfolio of logistics execution solution; and Manhattan Active Omni, which offers order management, store inventory and fulfillment, POS, and customer engagement tools for enterprises and stores. The company also provides inventory optimization and allocation solutions; technology platform including Manhattan Active Platform solutions, a cloud-native product designed to provide version-less product access; maintenance services, which offers on-premises software licensees with software upgrades for additional or improved functionality and technological advances; and professional services, such as solutions planning and implementation, and related consulting services. In addition, it provides training and change management services; and resells computer hardware, radio frequency terminal networks, radio frequency identification chip readers, bar code printers and scanners, and other peripherals. The company offers products through direct sales personnel and partnership agreements with various organizations. It serves retail, consumer goods, food and grocery, logistics service providers, industrial and wholesale, high technology and electronics, life sciences, and government industries. The company operates in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Manhattan Associates, Inc. was founded in 1990 and is headquartered in Atlanta, Georgia.

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.