Electronic design automation company Cadence Design Systems (NASDAQ: CDNS) will be reporting earnings this Monday after the bell. Here’s what investors should know.

Cadence Design Systems beat analysts’ revenue expectations last quarter, reporting revenues of $1.58 billion, up 24.2% year on year. It was a very strong quarter for the company, with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.

Is Cadence Design Systems a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting Cadence Design Systems’s revenue to grow 20.7% year on year, improving from the 10.1% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Cadence Design Systems has a history of exceeding Wall Street’s expectations.

Looking at Cadence Design Systems’s peers in the vertical software segment, only Adobe has reported results so far. It exceeded analysts’ revenue estimates, delivering year-on-year sales growth of 12.9%. The stock traded up 1.4% on the results.

There has been positive sentiment among investors in the vertical software segment, with share prices up 12.6% on average over the last month. Cadence Design Systems is down 2.8% during the same time and is heading into earnings with an average analyst price target of $406.24 (compared to the current share price of $317.03).

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