Guidewire (GWRE) AI Stock Analysis

• Market Cap: $17.50B
• Dividend Yield: N/A
• Average Volume (3M): 590.49K
• Price to Earnings (P/E): 530.8
• Beta (1Y): 0.91
• Revenue Growth: 18.61%
• EPS Growth: N/A
• Country: US
• Employees: 3,507
• Sector: Technology
• Sector Strength: 94
• Industry: Software - Application
• EPS (TTM): 0.88
• Shares Outstanding: 84,195,220
• 10 Day Avg. Volume: 597,419
• 30 Day Avg. Volume: 590,494
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 15.27
• Enterprise Value/Gross Profit: 24.58
• Enterprise Value/Ebitda: 241.76
• 1Y Price Target: $259.64
• Price Target Upside: 24.30% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 68 Neutral
• Price Target: $237.00 ▲(13.46% Upside)

Guidewire's overall stock score reflects strong financial performance and positive earnings call sentiment, which are offset by technical indicators suggesting bearish momentum and a high P/E ratio indicating potential overvaluation. The company's strategic growth and international expansion are positive factors, but valuation concerns and technical weaknesses weigh on the score.

Positive Factors

Cloud Migration

Guidewire delivered its third best quarter in company history with nine cloud migrations, five net new wins, and three expansions.

Competitive Positioning

Demand remains healthy and GWRE's competitive positioning continues to strengthen, especially among large carriers in North America and internationally.

Financial Performance

Guidewire reported strong 3Q25 results, with beats on all major metrics and positive revisions to revenue, ARR, operating income, and CFO guidance.

Negative Factors

Expected Return

Expected share price return is projected to be -8.8%, indicating a potential decline in stock value.

Market Perception

Despite strong execution, the analyst reiterates an Underperform rating, believing risk/reward is more attractive in other software stocks.

Stock Valuation

Following the strong 40% YTD rally in GWRE shares, many investors push back on GWRE valuation as the stock currently trades on 13x 2026E EV/Sales, making it among the more expensive names in SaaS universe.

Guidewire Business Overview & Revenue Model

Company Description

Guidewire Software, Inc. is a leading provider of software solutions for property and casualty (P&C) insurers. The company operates primarily in the insurance technology sector, offering a suite of products that enable insurers to manage their operations, from underwriting and policy administration to claims management and billing. Guidewire's core products include Guidewire InsuranceSuite, Guidewire Digital, and Guidewire Analytics, all designed to help insurers improve efficiency, enhance customer experience, and drive profitability in a competitive market.

How the Company Makes Money

Guidewire generates revenue primarily through the sale of software licenses, subscriptions, and professional services. The company offers its InsuranceSuite and other products through a combination of on-premise licenses and cloud-based subscriptions, with cloud services being a growing segment of its revenue. Professional services, including implementation, training, and support, contribute significantly to the overall revenue stream. Additionally, Guidewire has established partnerships with various technology providers and consulting firms, enhancing its market reach and enabling it to provide comprehensive solutions to insurers. These partnerships often lead to joint marketing efforts, integrations, and collaborative projects that further drive revenue growth.

Guidewire Financial Statement Overview

Summary

Guidewire demonstrates a strong financial position with consistent revenue growth and improving profitability. The balance sheet reflects stability with prudent leverage, while cash flow metrics show efficient cash utilization and growth. Areas for improvement include enhancing net profit margins and return on equity to further strengthen financial performance.

Income Statement

Guidewire shows strong revenue growth with a TTM increase of 16.01% compared to the previous annual period. The gross profit margin improved to 62.12% TTM, demonstrating operational efficiency. Positive net income TTM indicates a turnaround from past losses, although the net profit margin is relatively modest at 3.04%. EBIT and EBITDA margins have notably improved, indicating better cost management.

Balance Sheet

The company maintains a solid equity base with an equity ratio of 54.76% TTM, showing strong balance sheet stability. The debt-to-equity ratio is moderate at 0.52 TTM, indicating manageable leverage. Return on equity is modest at 2.54% TTM, reflecting room for improvement in profitability.

Cash Flow

Free cash flow grew by 34.73% TTM, reflecting strong cash generation. The operating cash flow to net income ratio of 7.22 TTM indicates excellent cash conversion from earnings, and the free cash flow to net income ratio is robust at 6.90 TTM, highlighting effective cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.14B	980.50M	905.34M	812.61M	743.27M	742.31M
Gross Profit	706.68M	583.36M	458.21M	352.22M	368.21M	404.29M
EBITDA	71.85M	2.21M	-101.21M	-176.73M	-37.17M	36.26M
Net Income	34.61M	-6.10M	-111.86M	-180.43M	-66.51M	-27.20M
Balance Sheet
Total Assets	2.49B	2.23B	2.03B	2.27B	2.32B	2.36B
Cash, Cash Equivalents and Short-Term Investments	920.44M	1.00B	798.68M	976.17M	1.12B	1.13B
Total Debt	706.71M	442.92M	448.58M	475.58M	470.82M	460.55M
Total Liabilities	1.13B	883.56M	828.42M	815.24M	776.95M	708.08M
Stockholders Equity	1.36B	1.34B	1.20B	1.45B	1.54B	1.66B
Cash Flow
Free Cash Flow	238.81M	177.22M	20.97M	-59.72M	82.73M	87.41M
Operating Cash Flow	249.81M	195.75M	38.40M	-37.94M	111.59M	113.07M
Investing Cash Flow	-185.87M	-52.36M	12.71M	312.21M	64.19M	-5.80M
Financing Cash Flow	82.61M	1.05M	-261.58M	-37.34M	-159.39M	4.96M

Guidewire Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 208.89
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GWRE, the sentiment is Negative. The current price of 208.89 is below the 20-day moving average (MA) of 220.26, below the 50-day MA of 231.06, and above the 200-day MA of 203.58, indicating a neutral trend. The MACD of -4.75 indicates Positive momentum. The RSI at 31.47 is Neutral, neither overbought nor oversold. The STOCH value of 12.98 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GWRE.

Guidewire Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SSNC	78 Outperform	$21.02B	27.11	12.07%	1.14%	6.75%	15.99%
PCTY	76 Outperform	$9.47B	42.73	20.04%	―	13.74%	10.99%
PAYC	76 Outperform	$12.46B	29.11	25.76%	0.69%	10.21%	-10.56%
PEGA	71 Outperform	$8.72B	44.08	41.55%	0.14%	12.47%	65.19%
GWRE	68 Neutral	$17.50B	530.75	2.61%	―	18.61%	―
BSY	66 Neutral	$15.90B	66.92	23.69%	0.50%	10.45%	-32.43%
Sector *	61 Neutral	$36.26B	7.13	-7.27%	1.97%	7.78%	-8.61%

Guidewire Corporate Events

Guidewire Appoints David Peterson as Accounting Officer

On July 24, 2025, Guidewire Software, Inc. appointed David Peterson as the principal accounting officer. Peterson, who has been with the company since 2018, previously served as Chief Accounting Officer. His appointment does not involve any new compensation arrangements, and he will continue under his current terms, including an annual base salary of $310,000 and eligibility for a bonus. This appointment solidifies Guidewire’s leadership team without altering existing compensation structures, indicating stability in its financial management.

The most recent analyst rating on (GWRE) stock is a Buy with a $182.00 price target. To see the full list of analyst forecasts on Guidewire stock, see the GWRE Stock Forecast page.