📊 CWAN Key Takeaways
Is Clearwater Analytics Holdings, Inc. (CWAN) a Good Investment?
Clearwater Analytics demonstrates strong revenue growth (+61.9% YoY) and exceptional cash generation (FCF margin 22.5%), but profitability remains challenged with negative operating margin (-1.1%) and net losses (-$38.8M). The company's solid balance sheet and high liquidity provide financial stability, though the path to profitability needs clarification.
Clearwater Analytics shows exceptional top-line momentum, strong gross margins, and robust free cash flow generation, which points to a scalable software model with solid underlying demand. However, the business remains unprofitable at the operating and net income levels, and negative interest coverage alongside meaningful long-term debt weakens the quality of that growth. Fundamentals support continued monitoring, but not a clearly aggressive stance until durable earnings leverage is demonstrated.
Why Buy Clearwater Analytics Holdings, Inc. Stock? CWAN Key Strengths
- Strong revenue growth of 61.9% YoY indicating market demand and scaling
- Excellent free cash flow generation of $164.3M (22.5% FCF margin) showing operational efficiency despite paper losses
- Healthy balance sheet with current ratio of 1.83x and moderate leverage (0.41x debt-to-equity)
- High gross margin of 67.3% typical of software businesses demonstrates pricing power
- Positive operating cash flow of $175.9M substantially exceeding net income losses
- Revenue growth of 61.9% YoY indicates strong demand and expansion
- Gross margin of 67.3% and free cash flow margin of 22.5% suggest an attractive software business model
- Liquidity is solid with a 1.83x current and quick ratio, supporting near-term financial flexibility
CWAN Stock Risks: Clearwater Analytics Holdings, Inc. Investment Risks
- Operating and net margins remain deeply negative (-1.1% and -5.3%) with no clear path to profitability improvement
- High insider activity (26 Form 4 filings in 90 days) may indicate potential liquidity concerns or option vesting pressure
- Negative interest coverage ratio (-9.2x) indicates inability to cover debt service from operations, relying on cash reserves
- Significant gap between cash flow generation and GAAP profitability suggests potential accounting charges or non-cash expenses masking operational issues
- Long-term debt of $822.6M represents 41% of equity, creating refinancing risk if profitability doesn't materialize
- Operating and net margins remain negative, showing profitability has not yet scaled with growth
- Interest coverage is deeply negative, indicating earnings are currently insufficient to support debt costs
- Long-term debt of $822.64M could pressure future flexibility if profit conversion remains weak
Key Metrics to Watch
- Path to operating profitability - operating margin trend and timeline to breakeven
- Cash burn sustainability - whether FCF can remain positive as growth normalizes
- Debt management strategy - refinancing plans and covenant compliance
- Operating expense ratio trends - critical to understand margin expansion potential
- Operating margin progression toward sustained profitability
- Free cash flow conversion relative to revenue growth
Clearwater Analytics Holdings, Inc. (CWAN) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 22.5% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments.
CWAN Profit Margin, ROE & Profitability Analysis
CWAN vs Technology Sector: How Clearwater Analytics Holdings, Inc. Compares
How Clearwater Analytics Holdings, Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Clearwater Analytics Holdings, Inc. Stock Overvalued? CWAN Valuation Analysis 2026
Based on fundamental analysis, Clearwater Analytics Holdings, Inc. shows some fundamental concerns relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Clearwater Analytics Holdings, Inc. Balance Sheet: CWAN Debt, Cash & Liquidity
CWAN Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Clearwater Analytics Holdings, Inc.'s revenue has grown significantly by 190% over the 5-year period, indicating strong business expansion. The most recent EPS of $-0.11 indicates the company is currently unprofitable.
CWAN Revenue Growth, EPS Growth & YoY Performance
CWAN Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $115.8M | $3.6M | $0.02 |
| Q2 2025 | $106.8M | -$430.0K | $0.00 |
| Q1 2025 | $102.7M | $1.9M | $0.01 |
| Q3 2024 | $94.7M | -$1.9M | $-0.01 |
| Q2 2024 | $89.9M | -$430.0K | $0.00 |
| Q1 2024 | $84.6M | $1.9M | $0.01 |
| Q3 2023 | $76.6M | -$1.9M | $-0.01 |
| Q2 2023 | $73.4M | -$2.0M | $-0.01 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Clearwater Analytics Holdings, Inc. Dividends, Buybacks & Capital Allocation
CWAN SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Clearwater Analytics Holdings, Inc. (CIK: 0001866368)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CWAN
What is the AI rating for CWAN?
Clearwater Analytics Holdings, Inc. (CWAN) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 68% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CWAN's key strengths?
Claude: Strong revenue growth of 61.9% YoY indicating market demand and scaling. Excellent free cash flow generation of $164.3M (22.5% FCF margin) showing operational efficiency despite paper losses. ChatGPT: Revenue growth of 61.9% YoY indicates strong demand and expansion. Gross margin of 67.3% and free cash flow margin of 22.5% suggest an attractive software business model.
What are the risks of investing in CWAN?
Claude: Operating and net margins remain deeply negative (-1.1% and -5.3%) with no clear path to profitability improvement. High insider activity (26 Form 4 filings in 90 days) may indicate potential liquidity concerns or option vesting pressure. ChatGPT: Operating and net margins remain negative, showing profitability has not yet scaled with growth. Interest coverage is deeply negative, indicating earnings are currently insufficient to support debt costs.
What is CWAN's revenue and growth?
Clearwater Analytics Holdings, Inc. reported revenue of $731.4M.
Does CWAN pay dividends?
Clearwater Analytics Holdings, Inc. pays dividends, with $163.3M distributed to shareholders in the trailing twelve months.
Where can I find CWAN SEC filings?
Official SEC filings for Clearwater Analytics Holdings, Inc. (CIK: 0001866368) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CWAN's EPS?
Clearwater Analytics Holdings, Inc. has a diluted EPS of $-0.14.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CWAN a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Clearwater Analytics Holdings, Inc. has a HOLD rating with 68% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is CWAN stock overvalued or undervalued?
Valuation metrics for CWAN: ROE of -1.9% (sector avg: 22%), net margin of -5.3% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy CWAN stock in 2026?
Our dual AI analysis gives Clearwater Analytics Holdings, Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CWAN's free cash flow?
Clearwater Analytics Holdings, Inc.'s operating cash flow is $175.9M, with capital expenditures of $11.6M. FCF margin is 22.5%.
How does CWAN compare to other Technology stocks?
Vs Technology sector averages: Net margin -5.3% (avg: 18%), ROE -1.9% (avg: 22%), current ratio 1.83 (avg: 2.5).