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Reasons to Retain Guidewire (GWRE) Stock in Your Portfolio
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Guidewire (GWRE - Free Report) is benefiting from the higher demand for cloud-based insurance software solutions.
The company’s fiscal 2023 and 2024 revenues are anticipated to rise 9.2% and 11% year over year, respectively. The company’s earnings are expected to increase 35.3% and 106.6% on a year-over-year basis in fiscal 2023 and 2024, respectively.
For first-quarter fiscal 2023, Guidewire expects revenues in the range of $190-$195 million. Annual recurring revenues (ARR) are expected to be between $667 million and $670 million. For fiscal 2023, Guidewire expects total revenues between $885 million and $895 million. ARR is expected to be between $745 million and $760 million.
For the fiscal first quarter, the Zacks Consensus Estimate for revenues stands at $190.6 million, suggesting year-over-year growth of 14.9%, while the same for the bottom line is pegged at a loss of 35 cents per share, wider than a loss of 21 cents reported in the year-ago quarter.
Guidewire outpaced estimates in all the trailing four quarters, delivering an earnings surprise of 61.6%, on average.
The company reported non-GAAP earnings of 3 cents per share for fourth-quarter fiscal 2022 (ended Jul 31, 2022) in contrast to the Zacks Consensus Estimate of a loss of 4 cents. However, this compared unfavorably with the year-ago quarter’s non-GAAP earnings of 37 cents per share. The company reported revenues of $244.6 million, which rose 7% year over year and beat the Zacks Consensus Estimate by 6.6%.
The stock is down 56.2% from its 52-week high level of $128.98 reached on Nov 9, 2021, making it more affordable for investors.
Healthy Growth Drivers
Headquartered in San Mateo, CA, GWRE is a provider of software solutions for property and casualty (P&C) insurers.
Guidewire’s performance is gaining from higher revenue growth across subscriptions and services' segments. Guidewire Cloud continues to gain momentum with 16 cloud deals in the fiscal fourth quarter, taking the count to 40 for the full year. The company’s focus on enhancing the Guidewire Cloud platform with new capabilities is expected to boost sales of subscription-based solutions.
Healthy adoption witnessed in subscription-based InsuranceSuite Cloud offerings is also contributing to overall subscription and supported revenues. Also, the migration activity for InsuranceSuite Cloud bodes well. ARR is being driven by new sales and deal ramp-ups.
Continued momentum in data and analytics is encouraging. Synergies from the buyout of HazardHub (August 2021) are favoring this segment’s performance. HazardHub provides extensive national coverage for risks that destroy and damage property. The addition of HazardHub bolsters Gudewire’s portfolio, which will help expand the company’s presence in the P&C market.
Although increasing expenses on product enhancements, especially cloud infrastructure and marketing initiatives, bode well over the long haul, it is likely to put pressure on margin expansion in the near term for this Zacks Rank #3 (Hold) stock.
The Zacks Consensus Estimate for Pure Storage’s 2022 earnings is pegged at $1.18 per share, rising 24.2% in the past 60 days. The long-term earnings growth rate is anticipated to be 35.5%.
Pure Storage’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 171.8%.
The Zacks Consensus Estimate for Blackbaud’s 2022 earnings is pegged at $2.55 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 3%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 8.5%.
The Zacks Consensus Estimate for WIX’s 2022 earnings is pegged at loss of 85 cents per share, narrowed by 15 cents in the past 60 days.
WIX’s earnings beat the Zacks Consensus Estimate in three out of the last four quarters, the average being 26.4%.
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Reasons to Retain Guidewire (GWRE) Stock in Your Portfolio
Guidewire (GWRE - Free Report) is benefiting from the higher demand for cloud-based insurance software solutions.
The company’s fiscal 2023 and 2024 revenues are anticipated to rise 9.2% and 11% year over year, respectively. The company’s earnings are expected to increase 35.3% and 106.6% on a year-over-year basis in fiscal 2023 and 2024, respectively.
For first-quarter fiscal 2023, Guidewire expects revenues in the range of $190-$195 million. Annual recurring revenues (ARR) are expected to be between $667 million and $670 million. For fiscal 2023, Guidewire expects total revenues between $885 million and $895 million. ARR is expected to be between $745 million and $760 million.
For the fiscal first quarter, the Zacks Consensus Estimate for revenues stands at $190.6 million, suggesting year-over-year growth of 14.9%, while the same for the bottom line is pegged at a loss of 35 cents per share, wider than a loss of 21 cents reported in the year-ago quarter.
Guidewire outpaced estimates in all the trailing four quarters, delivering an earnings surprise of 61.6%, on average.
Guidewire Software, Inc. Price
Guidewire Software, Inc. price | Guidewire Software, Inc. Quote
The company reported non-GAAP earnings of 3 cents per share for fourth-quarter fiscal 2022 (ended Jul 31, 2022) in contrast to the Zacks Consensus Estimate of a loss of 4 cents. However, this compared unfavorably with the year-ago quarter’s non-GAAP earnings of 37 cents per share. The company reported revenues of $244.6 million, which rose 7% year over year and beat the Zacks Consensus Estimate by 6.6%.
The stock is down 56.2% from its 52-week high level of $128.98 reached on Nov 9, 2021, making it more affordable for investors.
Healthy Growth Drivers
Headquartered in San Mateo, CA, GWRE is a provider of software solutions for property and casualty (P&C) insurers.
Guidewire’s performance is gaining from higher revenue growth across subscriptions and services' segments. Guidewire Cloud continues to gain momentum with 16 cloud deals in the fiscal fourth quarter, taking the count to 40 for the full year. The company’s focus on enhancing the Guidewire Cloud platform with new capabilities is expected to boost sales of subscription-based solutions.
Healthy adoption witnessed in subscription-based InsuranceSuite Cloud offerings is also contributing to overall subscription and supported revenues. Also, the migration activity for InsuranceSuite Cloud bodes well. ARR is being driven by new sales and deal ramp-ups.
Continued momentum in data and analytics is encouraging. Synergies from the buyout of HazardHub (August 2021) are favoring this segment’s performance. HazardHub provides extensive national coverage for risks that destroy and damage property. The addition of HazardHub bolsters Gudewire’s portfolio, which will help expand the company’s presence in the P&C market.
Although increasing expenses on product enhancements, especially cloud infrastructure and marketing initiatives, bode well over the long haul, it is likely to put pressure on margin expansion in the near term for this Zacks Rank #3 (Hold) stock.
Stocks to Consider
Some better-ranked stocks from the broader technology space are Pure Storage (PSTG - Free Report) , Blackbaud (BLKB - Free Report) and Wix.com Ltd (WIX - Free Report) . Pure Storage and Blackbaud currently sport a Zacks Rank #1 (Strong Buy), whereas WIX carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Pure Storage’s 2022 earnings is pegged at $1.18 per share, rising 24.2% in the past 60 days. The long-term earnings growth rate is anticipated to be 35.5%.
Pure Storage’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 171.8%.
The Zacks Consensus Estimate for Blackbaud’s 2022 earnings is pegged at $2.55 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 3%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 8.5%.
The Zacks Consensus Estimate for WIX’s 2022 earnings is pegged at loss of 85 cents per share, narrowed by 15 cents in the past 60 days.
WIX’s earnings beat the Zacks Consensus Estimate in three out of the last four quarters, the average being 26.4%.