Cadence Design Systems Inc (CDNS)

[eastunder]

Technical Trade Alerts on Newsworthy Market Movers: CDNS, COMS, EXTR, MOVE, IMAX, VLNC for Dec. 17 Wednesday December 17 2008

http://www.beaconequity.com/main/Trader-Notes

Today’s Trade Alerts include: Cadence Design Systems Inc. (Nasdaq: CDNS), 3Com Corp. (Nasdaq: COMS), Extreme Networks Inc. (Nasdaq: EXTR), Move Inc. (Nasdaq: MOVE), Imax Corp. (Nasdaq: IMAX) and Valence Technology Inc. (Nasdaq: VLNC).

Cadence Design Systems Inc. (CDNS) Trade Alert – CDNS Reports Lower Q3 Sales, Net Loss, Completes Accounting Review

Cadence Design Systems Inc. (CDNS) shares soared 10.29% to $3.43 Wednesday mid-day. Cadence develops electronic design automation software and hardware for electronics companies worldwide.

The company recently reported a 42% drop in third-quarter sales to $232 million from $401 million in the year-ago period and missing analysts' $239.3 million estimate. For the three months ended September 27, it said it lost $169 million, or 67 cents per share, compared with a profit of $72.7 million, or 24 cents per share, in the year-ago period.

For fiscal 2008, Cadence lowered its outlook, now expecting an adjusted loss of 4 cents to 6 cents per share on revenue of $1.025 billion to $1.035 billion, compared with its earlier forecast for profit of a penny to 5 cents per share on sales of $1.12 billion to $1.14 billion. Wall Street has been expecting profit of a penny per share on sales of nearly $1.1 billion.

Cadence recently said it completed an accounting review, finding that a contract was improperly accounted for, but no illegal activity on the part of its executives or employees. The company said it will be restating its quarterly financial statements for the periods ending March 29, 2008, and June 28, 2008. It will restate $24.8 million in revenue from the first quarter of 2008 and $12 million from the second quarter.

Cadence also announced the availability of Cadence Virtuoso Accelerated Parallel Simulator (APS), its next-generation circuit simulator, with the full accuracy of the industry reference Virtuoso Spectre Circuit Simulator, developed to solve the largest and most complex analog and mixed-signal designs across all process nodes.

Cadence's products and services are used to design and develop integrated circuits (ICs), and electronics systems.

The company's Incisive functional verification platform enables its customers to employ enterprise-level verification process automation, including verification planning, management and process tracking.

Its Encounter digital IC design platform enables its customers to implement various aspects of their digital nanometer-scale designs. This platform is used to accurately convert logical representation of a digital IC into a detailed physical blueprint and then detailed design information.

Cadence's Virtuoso custom design platform provides designers with an integrated solution and is used for ICs designed at the transistor level, including analog, radio frequency, memories, digital blocks and standard cell libraries.

Its Allegro system interconnect design platform enables to design electronic products across the domains of IC, package, and printed circuit board (PCB); and includes the OrCAD product line that focuses on PCB design products.

The company's Design for Manufacturing products are used to analyze and verify that the physical blueprint of the IC has been constructed correctly and can be manufactured. It also offers verification and application specific programming services, which include consulting services, project services and/or turnkey services for verification acceleration and system emulation.

In addition, Cadence provides technical support, as well as engineering and education services related to IC design and methodology.

In today's daily chart, CDNS' Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price action. MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. With share prices currently below the stock's 13-day moving average, the bearish signal is even more pronounced with decreasing moving averages.