📊 GWRE Key Takeaways
Is Guidewire Software, Inc. (GWRE) a Good Investment?
Guidewire demonstrates solid fundamental health with 22.6% revenue growth, strong gross margins (63.7%), and consistent free cash flow generation ($95.9M). The company maintains a healthy balance sheet (2.44x current ratio, 0.55x debt/equity) with sustainable operating leverage, though low operating margins (8.2%) and moderate capital returns (ROE 8.2%) indicate room for operational improvement.
Guidewire is delivering strong top-line growth with high gross margins and a return to profitability. Liquidity is robust and leverage is moderate, supporting continued investment while remaining free-cash-flow positive. Sustained upside depends on expanding operating margins and improving cash conversion.
Guidewire Software, Inc. Key Strengths (GWRE)
- Strong revenue growth of 22.6% YoY shows market traction and customer demand
- Excellent gross margins at 63.7% indicate strong pricing power and product-market fit typical of successful software
- Positive free cash flow generation ($95.9M, 9% FCF margin) demonstrates the business model is self-sustaining and asset-light
- Healthy liquidity position (2.44x current ratio) with $294.6M cash provides financial flexibility
- Reasonable leverage (0.55x debt/equity) with strong interest coverage (6.6x) shows prudent capital structure
- Low capital intensity (CapEx only $9.9M on $1.1B revenue) typical of mature software business
- 22.6% YoY revenue growth with 63.8% gross margin
- Return to positive operating and net income with sharp YoY improvement
- Strong liquidity (2.93x current ratio) and positive FCF
GWRE Stock Risks: Guidewire Software, Inc. Investment Risks
- Operating margin of 8.2% is substantially below software industry norms (15-25%), suggesting elevated costs or inefficiencies that may pressure profitability
- Diluted EPS jumped 1,257% YoY, likely reflecting prior-year losses or charges rather than sustainable earnings growth—signals potential earnings quality issues
- Moderate ROE of 8.2% indicates inefficient capital deployment relative to equity base, raising questions about value creation
- Substantial debt load of $728.8M represents 6.9x operating cash flow, limiting financial flexibility for growth investments or downturns
- Lack of visibility into whether 22.6% revenue growth is maintainable or if this is an elevated growth phase
- Operating margin remains modest (8.2%) and net margin likely benefits from non-operating items
- Cash conversion is moderate (5.3% FCF margin; OCF below NI)
- Interest coverage of 4.3x leaves limited buffer if conditions tighten
Key Metrics to Watch
- Operating margin trend—improving margins would validate business model maturation
- Free cash flow consistency and conversion rate—confirm 9% FCF margin is sustainable
- Debt reduction trajectory—monitor debt/EBITDA as key leverage metric
- Revenue growth deceleration—watch for slowdown signals from 22.6% growth rate
- Return on equity progression—assess capital efficiency improvements over time
- Operating margin
- Free cash flow margin
Guidewire Software, Inc. (GWRE) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.44x current ratio provides a solid financial cushion.
GWRE Profit Margin, ROE & Profitability Analysis
GWRE vs Technology Sector: How Guidewire Software, Inc. Compares
How Guidewire Software, Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Guidewire Software, Inc. Stock Overvalued? GWRE Valuation Analysis 2026
Based on fundamental analysis, Guidewire Software, 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.
Guidewire Software, Inc. Balance Sheet: GWRE Debt, Cash & Liquidity
GWRE Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Guidewire Software, Inc.'s revenue has grown significantly by 62% over the 5-year period, indicating strong business expansion. The most recent EPS of $-1.36 indicates the company is currently unprofitable.
GWRE Revenue Growth, EPS Growth & YoY Performance
GWRE Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $293.5M | $9.1M | $0.19 |
| Q2 2026 | $289.5M | $9.1M | $-0.34 |
| Q1 2026 | $262.9M | $9.1M | $0.11 |
| Q3 2025 | $240.7M | -$5.5M | $-0.07 |
| Q2 2025 | $240.9M | $9.1M | $0.12 |
| Q1 2025 | $207.4M | $9.1M | $0.11 |
| Q3 2024 | $207.5M | -$5.5M | $-0.07 |
| Q2 2024 | $232.6M | -$9.2M | $-0.11 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Guidewire Software, Inc. Dividends, Buybacks & Capital Allocation
GWRE SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Guidewire Software, Inc. (CIK: 0001528396)
📋 Recent SEC Filings
❓ Frequently Asked Questions about GWRE
What is the AI rating for GWRE?
Guidewire Software, Inc. (GWRE) has a Combined AI Grade of A from Claude (A) and ChatGPT (A) with 71% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are GWRE's key strengths?
Claude: Strong revenue growth of 22.6% YoY shows market traction and customer demand. Excellent gross margins at 63.7% indicate strong pricing power and product-market fit typical of successful software. ChatGPT: 22.6% YoY revenue growth with 63.8% gross margin. Return to positive operating and net income with sharp YoY improvement.
What are the risks of investing in GWRE?
Claude: Operating margin of 8.2% is substantially below software industry norms (15-25%), suggesting elevated costs or inefficiencies that may pressure profitability. Diluted EPS jumped 1,257% YoY, likely reflecting prior-year losses or charges rather than sustainable earnings growth—signals potential earnings quality issues. ChatGPT: Operating margin remains modest (8.2%) and net margin likely benefits from non-operating items. Cash conversion is moderate (5.3% FCF margin; OCF below NI).
What is GWRE's revenue and growth?
Guidewire Software, Inc. reported revenue of $1.1B.
Does GWRE pay dividends?
Guidewire Software, Inc. does not currently pay dividends.
Where can I find GWRE SEC filings?
Official SEC filings for Guidewire Software, Inc. (CIK: 0001528396) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is GWRE's EPS?
Guidewire Software, Inc. has a diluted EPS of $1.26.
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 grade reflects both perspectives for balanced insights.
What is GWRE's fundamental grade?
Based on our AI fundamental analysis in June 2026, Guidewire Software, Inc. has a A grade with 71% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is GWRE stock overvalued or undervalued?
Valuation metrics for GWRE: ROE of 8.2% (sector avg: 22%), net margin of 10.1% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
What is GWRE's AI grade for 2026?
Our dual AI analysis gives Guidewire Software, Inc. a combined A grade for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is GWRE's free cash flow?
Guidewire Software, Inc.'s operating cash flow is $105.8M, with capital expenditures of $9.9M. FCF margin is 9.0%.
How does GWRE compare to other Technology stocks?
Vs Technology sector averages: Net margin 10.1% (avg: 18%), ROE 8.2% (avg: 22%), current ratio 2.44 (avg: 2.5).