GUIDEWIRE SOFTWARE INC (GWRE) Stock Fundamental Analysis
USA - NYSE:GWRE - US40171V1008 - Common Stock
214.33 USD
-2.42 (-1.12%)
214.33 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to GWRE. GWRE was compared to 281 industry peers in the Software industry. While GWRE has a great health rating, its profitability is only average at the moment. GWRE shows excellent growth, but is valued quite expensive already.
1. Profitability
1.1 Basic Checks
GWRE had positive earnings in the past year.
In the past year GWRE had a positive cash flow from operations.
GWRE had negative earnings in 4 of the past 5 years.
Of the past 5 years GWRE 4 years had a positive operating cash flow.
1.2 Ratios
GWRE has a better Return On Assets (2.57%) than 65.12% of its industry peers.
GWRE has a Return On Equity of 4.79%. This is in the better half of the industry: GWRE outperforms 68.33% of its industry peers.
GWRE has a Return On Invested Capital of 1.49%. This is in the better half of the industry: GWRE outperforms 65.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.57% | ||
| ROE | 4.79% | ||
| ROIC | 1.49% |
ROA(3y)-1.07%
ROA(5y)-2.81%
ROE(3y)-1.66%
ROE(5y)-4.34%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
GWRE has a better Profit Margin (5.81%) than 66.90% of its industry peers.
GWRE has a Operating Margin of 3.42%. This is in the better half of the industry: GWRE outperforms 65.84% of its industry peers.
GWRE's Gross Margin of 62.54% is in line compared to the rest of the industry. GWRE outperforms 40.93% of its industry peers.
GWRE's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.42% | ||
| PM (TTM) | 5.81% | ||
| GM | 62.54% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y10.45%
GM growth 5Y2.8%
2. Health
2.1 Basic Checks
GWRE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
GWRE has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, GWRE has more shares outstanding
Compared to 1 year ago, GWRE has a worse debt to assets ratio.
2.2 Solvency
GWRE has an Altman-Z score of 9.33. This indicates that GWRE is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 9.33, GWRE belongs to the best of the industry, outperforming 87.54% of the companies in the same industry.
The Debt to FCF ratio of GWRE is 2.41, which is a good value as it means it would take GWRE, 2.41 years of fcf income to pay off all of its debts.
GWRE's Debt to FCF ratio of 2.41 is fine compared to the rest of the industry. GWRE outperforms 66.55% of its industry peers.
GWRE has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.46, GWRE is not doing good in the industry: 62.63% of the companies in the same industry are doing better.
Although GWRE does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.41 | ||
| Altman-Z | 9.33 |
ROIC/WACC0.14
WACC10.95%
2.3 Liquidity
GWRE has a Current Ratio of 2.77. This indicates that GWRE is financially healthy and has no problem in meeting its short term obligations.
GWRE's Current ratio of 2.77 is fine compared to the rest of the industry. GWRE outperforms 75.44% of its industry peers.
GWRE has a Quick Ratio of 2.77. This indicates that GWRE is financially healthy and has no problem in meeting its short term obligations.
GWRE has a better Quick ratio (2.77) than 75.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.77 |
3. Growth
3.1 Past
GWRE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 98.51%, which is quite impressive.
The Earnings Per Share has been growing by 16.12% on average over the past years. This is quite good.
Looking at the last year, GWRE shows a very strong growth in Revenue. The Revenue has grown by 22.64%.
Measured over the past years, GWRE shows a quite strong growth in Revenue. The Revenue has been growing by 10.13% on average per year.
EPS 1Y (TTM)98.51%
EPS 3YN/A
EPS 5Y16.12%
EPS Q2Q%35.48%
Revenue 1Y (TTM)22.64%
Revenue growth 3Y13.95%
Revenue growth 5Y10.13%
Sales Q2Q%22.32%
3.2 Future
Based on estimates for the next years, GWRE will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.37% on average per year.
The Revenue is expected to grow by 14.46% on average over the next years. This is quite good.
EPS Next Y14.19%
EPS Next 2Y22.87%
EPS Next 3Y22.64%
EPS Next 5Y19.37%
Revenue Next Year17.88%
Revenue Next 2Y16.48%
Revenue Next 3Y16.32%
Revenue Next 5Y14.46%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
GWRE is valuated quite expensively with a Price/Earnings ratio of 80.58.
The rest of the industry has a similar Price/Earnings ratio as GWRE.
Compared to an average S&P500 Price/Earnings ratio of 25.51, GWRE is valued quite expensively.
GWRE is valuated quite expensively with a Price/Forward Earnings ratio of 70.56.
GWRE's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.98, GWRE is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 80.58 | ||
| Fwd PE | 70.56 |
4.2 Price Multiples
GWRE's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as GWRE.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 64.61 | ||
| EV/EBITDA | 268.34 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GWRE does not grow enough to justify the current Price/Earnings ratio.
GWRE's earnings are expected to grow with 22.64% in the coming years. This may justify a more expensive valuation.
PEG (NY)5.68
PEG (5Y)5
EPS Next 2Y22.87%
EPS Next 3Y22.64%
5. Dividend
5.1 Amount
GWRE does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
214.33
-2.42 (-1.12%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners100.7%
Inst Owner Change65.75%
Ins Owners0.4%
Ins Owner Change-4.64%
Market Cap18.12B
Revenue(TTM)1.20B
Net Income(TTM)69.80M
Analysts80
Price Target271.76 (26.8%)
Short Float %2.05%
Short Ratio2.5
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)58.16%
Min EPS beat(2)29.72%
Max EPS beat(2)86.6%
EPS beat(4)3
Avg EPS beat(4)38.41%
Min EPS beat(4)-3.3%
Max EPS beat(4)86.6%
EPS beat(8)7
Avg EPS beat(8)56.62%
EPS beat(12)10
Avg EPS beat(12)-4.25%
EPS beat(16)14
Avg EPS beat(16)20.42%
Revenue beat(2)2
Avg Revenue beat(2)2.32%
Min Revenue beat(2)1.18%
Max Revenue beat(2)3.47%
Revenue beat(4)3
Avg Revenue beat(4)1.48%
Min Revenue beat(4)-0.61%
Max Revenue beat(4)3.47%
Revenue beat(8)6
Avg Revenue beat(8)0.98%
Revenue beat(12)8
Avg Revenue beat(12)0.51%
Revenue beat(16)11
Avg Revenue beat(16)0.88%
PT rev (1m)0%
PT rev (3m)6.92%
EPS NQ rev (1m)1.8%
EPS NQ rev (3m)18.72%
EPS NY rev (1m)1.18%
EPS NY rev (3m)6.5%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)5.15%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.96%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 80.58 | ||
| Fwd PE | 70.56 | ||
| P/S | 15.07 | ||
| P/FCF | 64.61 | ||
| P/OCF | 60.22 | ||
| P/B | 12.43 | ||
| P/tB | 17.23 | ||
| EV/EBITDA | 268.34 |
EPS(TTM)2.66
EY1.24%
EPS(NY)3.04
Fwd EY1.42%
FCF(TTM)3.32
FCFY1.55%
OCF(TTM)3.56
OCFY1.66%
SpS14.23
BVpS17.24
TBVpS12.44
PEG (NY)5.68
PEG (5Y)5
Graham Number32.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.57% | ||
| ROE | 4.79% | ||
| ROCE | 1.89% | ||
| ROIC | 1.49% | ||
| ROICexc | 3.16% | ||
| ROICexgc | 5.23% | ||
| OM | 3.42% | ||
| PM (TTM) | 5.81% | ||
| GM | 62.54% | ||
| FCFM | 23.32% |
ROA(3y)-1.07%
ROA(5y)-2.81%
ROE(3y)-1.66%
ROE(5y)-4.34%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y10.45%
GM growth 5Y2.8%
F-Score7
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.41 | ||
| Debt/EBITDA | 10.41 | ||
| Cap/Depr | 86.1% | ||
| Cap/Sales | 1.7% | ||
| Interest Coverage | 3.48 | ||
| Cash Conversion | 464.12% | ||
| Profit Quality | 401.71% | ||
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.77 | ||
| Altman-Z | 9.33 |
F-Score7
WACC10.95%
ROIC/WACC0.14
Cap/Depr(3y)79.77%
Cap/Depr(5y)76.46%
Cap/Sales(3y)1.84%
Cap/Sales(5y)2.42%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)98.51%
EPS 3YN/A
EPS 5Y16.12%
EPS Q2Q%35.48%
EPS Next Y14.19%
EPS Next 2Y22.87%
EPS Next 3Y22.64%
EPS Next 5Y19.37%
Revenue 1Y (TTM)22.64%
Revenue growth 3Y13.95%
Revenue growth 5Y10.13%
Sales Q2Q%22.32%
Revenue Next Year17.88%
Revenue Next 2Y16.48%
Revenue Next 3Y16.32%
Revenue Next 5Y14.46%
EBIT growth 1Y183.35%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year53.97%
EBIT Next 3Y38.75%
EBIT Next 5Y21.54%
FCF growth 1Y58.23%
FCF growth 3YN/A
FCF growth 5Y26.26%
OCF growth 1Y53.7%
OCF growth 3YN/A
OCF growth 5Y21.62%
GUIDEWIRE SOFTWARE INC / GWRE FAQ
Can you provide the ChartMill fundamental rating for GUIDEWIRE SOFTWARE INC?
ChartMill assigns a fundamental rating of 5 / 10 to GWRE.
What is the valuation status for GWRE stock?
ChartMill assigns a valuation rating of 2 / 10 to GUIDEWIRE SOFTWARE INC (GWRE). This can be considered as Overvalued.
What is the profitability of GWRE stock?
GUIDEWIRE SOFTWARE INC (GWRE) has a profitability rating of 4 / 10.
How financially healthy is GUIDEWIRE SOFTWARE INC?
The financial health rating of GUIDEWIRE SOFTWARE INC (GWRE) is 7 / 10.
What is the expected EPS growth for GUIDEWIRE SOFTWARE INC (GWRE) stock?
The Earnings per Share (EPS) of GUIDEWIRE SOFTWARE INC (GWRE) is expected to grow by 14.19% in the next year.