Latest news with #GWRE
Yahoo
5 days ago
- Business
- Yahoo
Guidewire Rises 23% YTD: Where Will the Stock Head From Here?
Guidewire Software GWRE stock has appreciated 23.3% year to date compared with the Zacks Internet Software industry's growth of 23.7%. The broader Computer and Technology sector and the S&P 500 composite have returned 14.6% and 9.5%, respectively, over the same time frame. San Mateo, CA-based Guidewire is a provider of software solutions for property and casualty insurers. GWRE closed last session at $207.87. The stock is trading 21% down from its 52-week high of $263.20. Does the pullback indicate a buying opportunity? Price Performance Image Source: Zacks Investment Research Let us dive into GWRE's pros and cons and determine the best course of action for your portfolio. Factors Driving Growth for GWRE Guidewire is benefiting from strong momentum in its cloud business, fueled by rising demand from insurers moving away from legacy systems toward cloud-based solutions. The company has strategically expanded its cloud ecosystem, now encompassing 26,000 Guidewire-specialized practitioners across 38 system integrators. Its focus on enhancing the Guidewire Cloud platform with new capabilities, including digital frameworks, automation, tooling and other cloud services, is expected to boost sales of subscription-based solutions in the long haul. Also, the company announced its first sale of Guidewire Industry Intelligence, a pre-built predictive model embedded into ClaimCenter workflow in the last reported quarter. This solution is trained and validated using anonymized data available on Guidewire's cloud deployments. This not only represents a new revenue opportunity but is a value addition for insurers looking to make data-driven claims decisions. In the fiscal third quarter of 2025, Guidewire secured 17 new deals, 14 for various InsuranceSuite Cloud applications and three for InsuranceNow. These included seven core system wins with Tier 1 insurers and three with Tier 2 insurers. Guidewire Software, Inc. Price, Consensus and EPS Surprise Guidewire Software, Inc. price-consensus-eps-surprise-chart | Guidewire Software, Inc. QuoteManagement's efforts to drive cloud operations efficiency to boost cloud margins remain an additional tailwind. Non-GAAP gross margin expanded to 65.5% from 62.6% on a year-over-year basis. The subscription and support segment's gross margin increased to 70.6% from 65.6% on a year-over-year basis, attributed to higher-than-expected revenues and increases in cloud infrastructure platform efficiency, along with $4 million in credits received from its cloud service provider. Services' non-GAAP gross margin was 12.9% against negative 10.3% in the year-ago quarter. For the fiscal fourth quarter, non-GAAP operating income is estimated in the range of $52-$60 million. Non-GAAP operating income for fiscal 2025 is estimated between $187 million and $195 million compared with $175-$185 million expected by strong collections, Guidewire generated $32.4 million in cash from operations in the quarter under discussion, while free cash flow was nearly $27.8 million. As of April 30, 2025, cash and cash equivalents and short-term investments were $1,243.7 million, with $673.7 million of long-term debt. The company's ability to generate positive cash flow while continuing to invest in growth initiatives provides a solid foundation for by strong revenue performance in the fiscal third quarter, Guidewire expects total revenues for fiscal 2025 to be between $1.178 billion and $1.186 billion compared with earlier guidance of $1.164 billion to $1.174 billion. Subscription revenues are now forecasted to be $660 million, while subscription and support revenues are expected to be $724 million. Services revenues are expected to be approximately $215 million. Image Source: Zacks Investment ResearchIn the past 60 days, analysts have marginally revised estimates upwards for the current year. GWRE Faces Headwinds Higher costs remain a concern for Guidewire, especially amid prevailing weakness in global macroeconomic conditions. In the fiscal third quarter, total operating expenses increased 12.1% year over year to $178.2 million. Increasing costs can put downward pressure on the company's profitability, especially if the revenue performance weakens. Guidewire increasing global footprint, with new customers primarily coming from diverse markets such as Japan, Brazil, Belgium and other international regions, presents foreign exchange as well as integration risks. Strengthening the U.S. dollar could further exacerbate these challenges. Also, these initiatives involve execution risk, especially in regions with different regulatory requirements. If integration delays arise, these could weigh on operating margins or delay expected revenue contributions. GWRE stock is also not so cheap, as its Value Style Score of F indicates a stretched valuation at this moment. The stock is trading at a premium with a forward 12-month price/sales of 12.95X compared with the industry's 5.84X. Retain GWRE Stock With a Zacks Rank #3 (Hold), GWRE appears to be treading in the middle of the road and new investors could be better off if they trade with caution. The stock is also trading at a premium valuation. New investors could wait for a better entry point to capitalize on its long-term fundamentals, while investors owning the stock can stay put. Stocks to Consider Some better-ranked stocks worth consideration with the same industry space are Arista Networks (ANET), Astera Labs ALAB and F5, Inc. FFIV. All stocks sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. The Zacks Consensus Estimate for ANET's 2025 earnings is pegged at $2.81 per share. ANET's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 12.8%. Its shares have gained 62.1% in the past year. The Zacks Consensus Estimate for ALAB's 2025 EPS is pegged at $1.35, unchanged in the past 60 days. Astera Labs' earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 32.2%. Its shares have surged 394.1% in the past year. The Zacks Consensus Estimate for FFIV's fiscal 2025 EPS is pegged at $15.26, unchanged in the past seven days. FFIV's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 12.46%. Its shares have gained 70.6% in the past year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report F5, Inc. (FFIV) : Free Stock Analysis Report Guidewire Software, Inc. (GWRE) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report Astera Labs, Inc. (ALAB) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
10-07-2025
- Business
- Yahoo
GWRE Stock Rises 36% in 6 Months: Stay Invested or Book Profits?
Guidewire Software GWRE stock has appreciated 36.4% in the past six months, significantly outperforming the Zacks Internet Software industry's growth of 17.3%. San Mateo, CA-based Guidewire is a provider of software solutions for property and casualty insurers. Image Source: Zacks Investment Research GWRE closed last session at $231.25. The stock is trading 12.1% down from its 52-week high of $263.20. The recent rally has sparked a familiar dilemma, is it time to stay invested for further upside, or book profits after a strong run? Let us dive into GWRE's pros and cons and determine the best course of action for your portfolio. Momentum in Guidewire Cloud is a tailwind. GWRE is experiencing increasing demand for its cloud platform as insurers transition from legacy systems to cloud-based solutions. The company has strategically built out its cloud ecosystem. This now consists of 26,000 Guidewire-focused practitioners across 38 system integrators. The company reported 17 deal wins in the fiscal third quarter of 2025. Out of these deals, 14 were for various InsuranceSuite Cloud applications and three InsuranceNow deals. It closed seven core system deals with Tier 1 insurers and three with Tier 2 company's focus on enhancing the Guidewire Cloud platform with new capabilities, including digital frameworks, automation, tooling and other cloud services, is expected to boost sales of subscription-based solutions in the long haul. In the last reported quarter, the company announced its first sale of Guidewire Industry Intelligence, a pre-built predictive model embedded into ClaimCenter workflow. This solution is trained and validated using anonymized data available on Guidewire's cloud deployments. This not only represents a new revenue opportunity but is a value addition for insurers looking to make data-driven claims decisions. Management's efforts to drive cloud operations efficiency to boost cloud margins remain an additional tailwind. Non-GAAP gross margin expanded to 65.5% from 62.6% on a year-over-year basis. The subscription and support segment's gross margin increased to 70.6% from 65.6% on a year-over-year basis, attributed to higher-than-expected revenues and increases in cloud infrastructure platform efficiency, along with $4 million in credits received from its cloud service provider. Services' non-GAAP gross margin was 12.9% against negative 10.3% in the year-ago quarter. For the fiscal fourth quarter, non-GAAP operating income is estimated in the range of $52-$60 million. Non-GAAP operating income for fiscal 2025 is estimated between $187 million and $195 million compared with $175-$185 million expected previously. Guidewire Software, Inc. price-consensus-eps-surprise-chart | Guidewire Software, Inc. Quote Driven by strong collections, Guidewire generated $32.4 million in cash from operations in the quarter under discussion while free cash flow was nearly $27.8 million. As of April 30, 2025, cash and cash equivalents and short-term investments were $1,243.7 million, with $673.7 million of long-term debt. The company's ability to generate positive cash flow while continuing to invest in growth initiatives provides a solid foundation for by strong revenue performance in the fiscal third quarter, Guidewire expects total revenues for fiscal 2025 to be between $1.178 billion and $1.186 billion compared with earlier guidance of $1.164 billion to $1.174 billion. Subscription revenues are now forecasted to be $660 million, while subscription and support revenues are expected to be $724 million. Services revenues are expected to be approximately $215 million. In the past 60 days, analysts have revised significantly upwards estimates for the current year. Image Source: Zacks Investment Research Higher costs remain a concern for Guidewire, especially amid weakness prevailing over global macroeconomic conditions. In the fiscal third quarter, total operating expenses increased 12.1% year over year to $178.2 million. Increasing costs can put downward pressure on the company's profitability, especially if the revenue performance weakens. Guidewire increasing global footprint, with new customers primarily coming from diverse markets such as Japan, Brazil, Belgium and other international regions, presents a forex as well as integration risks. Strengthening the U.S. dollar could further exacerbate these challenges. Also, these initiatives involve execution risk, especially in regions with different regulatory requirements. If integration delays arise, these could weigh on operating margins or delay expected revenue contributions. GWRE stock is also not so cheap, as its Value Style Score of F indicates a stretched valuation at this moment. The stock is trading at a premium with a forward 12-month price/sales of 14.58X compared with the industry's 5.88X. Image Source: Zacks Investment Research Guidewire's strong cloud momentum, expanding margins and solid cash position make it a fundamentally sound company with long-term growth potential. With shares still below their 52-week high, there may be room for moderate gains. However, with a Zacks Rank #3 (Hold), GWRE appears to be treading in the middle of the road and new investors could be better off if they trade with caution. The stock is also trading at premium valuation metrics and investors could wait for a better entry point to capitalize on its long-term fundamentals. Consequently, it might not be prudent to bet on the stock at the moment. Some better-ranked stocks worth consideration with the same industry space are Freshworks Inc. FRSH, Automatic Data Processing, Inc. ADP and F5, Inc. FFIV. While FRSH sports a Zacks Rank #1 (Strong Buy), ADP and FFIV presently hold a Zacks Rank #2 (Buy) each. You can see the complete list of today's Zacks #1 Rank stocks here. The Zacks Consensus Estimate for FRSH's 2025 earnings is pegged at 57 cents per share. FRSH earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 37.3%. Its shares have gained 20.4% in the past year. The Zacks Consensus Estimate for ADP's fiscal 2026 EPS is pegged at $10.92, unchanged in the past seven days. ADP's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 3.45%. Its shares have surged 30.9% in the past year. The Zacks Consensus Estimate for FFIV's fiscal 2025 EPS is pegged at $14.58, up 3 cents in the past seven days. FFIV's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 10.95%. Its shares have gained 74% in the past year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report F5, Inc. (FFIV) : Free Stock Analysis Report Guidewire Software, Inc. (GWRE) : Free Stock Analysis Report Freshworks Inc. (FRSH) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-06-2025
- Business
- Yahoo
1 Mid-Cap Stock to Own for Decades and 2 to Question
Many investors pay attention to mid-cap stocks because they have established business models and expansive market opportunities. However, their paths to becoming $100 billion corporations are ripe with competition, ranging from giants with vast resources to agile upstarts eager to disrupt the status quo. This is precisely where StockStory comes in - we do the heavy lifting to identify companies with solid fundamentals so you can invest with confidence. That said, here is one mid-cap stock with a long growth runway and two that may have trouble. Market Cap: $19.82 billion Founded by two individuals involved in the development of leading procurement software Ariba, Guidewire (NYSE:GWRE) offers insurance companies a software-as-a-service platform to help sell their products and manage their workflows. Why Does GWRE Give Us Pause? Annual revenue growth of 12.6% over the last three years was below our standards for the software sector High servicing costs result in a relatively inferior gross margin of 61.9% that must be offset through increased usage At $235.40 per share, Guidewire trades at 15.5x forward price-to-sales. Check out our free in-depth research report to learn more about why GWRE doesn't pass our bar. Market Cap: $16.33 billion Becoming the first private company in the Southern Hemisphere to reach space, Rocket Lab (NASDAQ:RKLB) offers rockets designed for launching small satellites. Why Does RKLB Fall Short? Historically negative EPS is a worrisome sign for conservative investors and obscures its long-term earnings potential Negative free cash flow raises questions about the return timeline for its investments Short cash runway increases the probability of a capital raise that dilutes existing shareholders Rocket Lab's stock price of $35.23 implies a valuation ratio of 28.4x forward price-to-sales. To fully understand why you should be careful with RKLB, check out our full research report (it's free). Market Cap: $28.17 billion Originally serving yogis and hockey players, Lululemon (NASDAQ:LULU) is a designer, distributor, and retailer of athletic apparel for men and women. Why Is LULU a Top Pick? Locations open for at least a year are seeing increased demand as same-store sales have averaged 6.6% growth over the past two years Unique assortment of products and pricing power are reflected in its best-in-class gross margin of 58.9% Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends Lululemon is trading at $235.10 per share, or 15.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it's free. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
29-06-2025
- Business
- Yahoo
Wells Fargo Raised the PT on Guidewire Software (GWRE), Keeps an Overweight Rating
Guidewire Software, Inc. (NYSE:GWRE) is one of the . On June 6, Wells Fargo raised the firm's price target on Guidewire Software, Inc. (NYSE:GWRE) from $220 to $265, while keeping an Overweight rating on the stocks. The price target upgrade comes after the company posted a strong Q3 with momentum carrying forward to Q4. On June 3, Guidewire Software, Inc. (NYSE:GWRE) announced its Q3 2025 results. The company posted $293.51 million in revenue, reflecting 21.95% growth year-over-year and topping the consensus by $7.12 million. The EPS of $0.88 also exceeded the expectations by $0.41. Management noted it experienced record sales activity with 13 new cloud deals. Notably, the company's Subscription and Support Revenue of $181.8 million grew 32% year-over-year. An insurance adjuster reviewing images and paperwork to process a claim. Due to strong execution and a robust sales pipeline, Guidewire Software, Inc. (NYSE:GWRE) raised its full-year fiscal 2025 targets. The company expects total revenue for the year to be around $332 million and $340 million. Whereas the ARR is anticipated to reach $1.012 billion and $1.022 billion. Guidewire Software, Inc. (NYSE:GWRE) provides a cloud-based platform for property and casualty insurance companies. The system is capable of managing the entire insurance lifecycle from product definition to claims management. While we acknowledge the potential of GWRE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
26-06-2025
- Business
- Yahoo
Here's Why Guidewire Software (GWRE) Rose in Q1
Wasatch Global Investors, an asset management company, released its 'Wasatch U.S. Select Strategy' first-quarter 2025 investor letter. A copy of the letter can be downloaded here. US equities declined in the first quarter due to potential tariffs and government funding cuts. Against this backdrop, the strategy was down but exceeded the Russell Midcap® Growth Index, which lost -7.12%. In addition, please check the fund's top five holdings to know its best picks in 2025. In its first-quarter 2025 investor letter, Wasatch U.S. Select Strategy highlighted stocks such as Guidewire Software, Inc. (NYSE:GWRE). Guidewire Software, Inc. (NYSE:GWRE) offers a platform for property and casualty (P&C) insurance companies. The one-month return of Guidewire Software, Inc. (NYSE:GWRE) was 11.68%, and its shares gained 72.02% of their value over the last 52 weeks. On June 25, 2025, Guidewire Software, Inc. (NYSE:GWRE) stock closed at $236.01 per share, with a market capitalization of $19.871 billion. Wasatch U.S. Select Strategy stated the following regarding Guidewire Software, Inc. (NYSE:GWRE) in its Q1 2025 investor letter: "Another top contributor was Guidewire Software, Inc. (NYSE:GWRE), a software provider whose solutions target the insurance industry. We believe Guidewire remains a clear leader in replacing legacy technology solutions for property and casualty insurers. This is a large industry to serve, and acquisitions Guidewire made have bolstered its offerings to the market." An insurance adjuster reviewing images and paperwork to process a claim. Guidewire Software, Inc. (NYSE:GWRE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 55 hedge fund portfolios held Guidewire Software, Inc. (NYSE:GWRE) at the end of the first quarter, which was 60 in the previous quarter. While we acknowledge the potential of Guidewire Software, Inc. (NYSE:GWRE) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains. In another article, we covered Guidewire Software, Inc. (NYSE:GWRE) and shared The BBH Select Series – Mid Cap Fund's views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of GWRE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. This article is originally published at Insider Monkey. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
