GUIDEWIRE SOFTWARE INC (GWRE) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:GWRE - US40171V1008 - Common Stock
200.1 USD
-10.45 (-4.96%)
200 USD
-0.1 (-0.05%)
GWRE gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 280 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.
In the past 5 years GWRE reported 4 times negative net income.
GWRE had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of GWRE (3.48%) is better than 67.86% of its industry peers.
The Return On Equity of GWRE (6.00%) is better than 70.00% of its industry peers.
GWRE has a better Return On Invested Capital (2.26%) than 67.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.48% | ||
| ROE | 6% | ||
| ROIC | 2.26% |
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 Profit Margin of 7.23%. This is in the better half of the industry: GWRE outperforms 67.86% of its industry peers.
With a decent Operating Margin value of 5.05%, GWRE is doing good in the industry, outperforming 68.21% of the companies in the same industry.
The Gross Margin of GWRE (63.13%) is comparable to the rest of the industry.
GWRE's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.05% | ||
| PM (TTM) | 7.23% | ||
| GM | 63.13% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so GWRE is destroying value.
GWRE has more shares outstanding than it did 1 year ago.
The number of shares outstanding for GWRE has been increased compared to 5 years ago.
Compared to 1 year ago, GWRE has a worse debt to assets ratio.
2.2 Solvency
GWRE has an Altman-Z score of 10.44. This indicates that GWRE is financially healthy and has little risk of bankruptcy at the moment.
GWRE's Altman-Z score of 10.44 is amongst the best of the industry. GWRE outperforms 87.14% of its industry peers.
The Debt to FCF ratio of GWRE is 2.50, which is a good value as it means it would take GWRE, 2.50 years of fcf income to pay off all of its debts.
GWRE has a better Debt to FCF ratio (2.50) than 66.43% of its industry peers.
A Debt/Equity ratio of 0.44 indicates that GWRE is not too dependend on debt financing.
GWRE's Debt to Equity ratio of 0.44 is on the low side compared to the rest of the industry. GWRE is outperformed by 62.50% of its industry peers.
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 | 0.44 | ||
| Debt/FCF | 2.5 | ||
| Altman-Z | 10.44 |
ROIC/WACC0.21
WACC10.8%
2.3 Liquidity
A Current Ratio of 3.48 indicates that GWRE has no problem at all paying its short term obligations.
GWRE has a better Current ratio (3.48) than 78.93% of its industry peers.
A Quick Ratio of 3.48 indicates that GWRE has no problem at all paying its short term obligations.
With a decent Quick ratio value of 3.48, GWRE is doing good in the industry, outperforming 78.93% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.48 | ||
| Quick Ratio | 3.48 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 63.28% over the past year.
GWRE shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.12% yearly.
GWRE shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.80%.
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)63.28%
EPS 3YN/A
EPS 5Y16.12%
EPS Q2Q%53.49%
Revenue 1Y (TTM)22.8%
Revenue growth 3Y13.95%
Revenue growth 5Y10.13%
Sales Q2Q%26.53%
3.2 Future
The Earnings Per Share is expected to grow by 19.37% on average over the next years. This is quite good.
The Revenue is expected to grow by 14.46% on average over the next years. This is quite good.
EPS Next Y14.46%
EPS Next 2Y21.56%
EPS Next 3Y22.63%
EPS Next 5Y19.37%
Revenue Next Year17.88%
Revenue Next 2Y16.52%
Revenue Next 3Y16.09%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 69.24, which means the current valuation is very expensive for GWRE.
GWRE's Price/Earnings ratio is in line with the industry average.
GWRE's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.49.
With a Price/Forward Earnings ratio of 50.91, GWRE can be considered very expensive at the moment.
GWRE's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of GWRE to the average of the S&P500 Index (23.69), we can say GWRE is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.24 | ||
| Fwd PE | 50.91 |
4.2 Price Multiples
GWRE's Enterprise Value to EBITDA is on the same level as the industry average.
GWRE's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 62.91 | ||
| EV/EBITDA | 192.51 |
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 22.63% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.79
PEG (5Y)4.3
EPS Next 2Y21.56%
EPS Next 3Y22.63%
5. Dividend
5.1 Amount
GWRE does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
200.1
-10.45 (-4.96%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners100.35%
Inst Owner Change65.76%
Ins Owners0.43%
Ins Owner Change-1.97%
Market Cap17.01B
Revenue(TTM)1.27B
Net Income(TTM)91.97M
Analysts80
Price Target269.89 (34.88%)
Short Float %1.79%
Short Ratio2.3
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)17.66%
Min EPS beat(2)5.59%
Max EPS beat(2)29.72%
EPS beat(4)3
Avg EPS beat(4)29.65%
Min EPS beat(4)-3.3%
Max EPS beat(4)86.6%
EPS beat(8)7
Avg EPS beat(8)44.81%
EPS beat(12)10
Avg EPS beat(12)-9.61%
EPS beat(16)14
Avg EPS beat(16)19.7%
Revenue beat(2)2
Avg Revenue beat(2)3.23%
Min Revenue beat(2)3%
Max Revenue beat(2)3.47%
Revenue beat(4)3
Avg Revenue beat(4)1.76%
Min Revenue beat(4)-0.61%
Max Revenue beat(4)3.47%
Revenue beat(8)6
Avg Revenue beat(8)1.21%
Revenue beat(12)9
Avg Revenue beat(12)0.77%
Revenue beat(16)12
Avg Revenue beat(16)1.14%
PT rev (1m)-0.69%
PT rev (3m)6.19%
EPS NQ rev (1m)2.11%
EPS NQ rev (3m)2.42%
EPS NY rev (1m)0.24%
EPS NY rev (3m)6.37%
Revenue NQ rev (1m)1.15%
Revenue NQ rev (3m)2.97%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.96%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.24 | ||
| Fwd PE | 50.91 | ||
| P/S | 13.37 | ||
| P/FCF | 62.91 | ||
| P/OCF | 57.52 | ||
| P/B | 11.09 | ||
| P/tB | 15.08 | ||
| EV/EBITDA | 192.51 |
EPS(TTM)2.89
EY1.44%
EPS(NY)3.93
Fwd EY1.96%
FCF(TTM)3.18
FCFY1.59%
OCF(TTM)3.48
OCFY1.74%
SpS14.96
BVpS18.04
TBVpS13.27
PEG (NY)4.79
PEG (5Y)4.3
Graham Number34.25
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.48% | ||
| ROE | 6% | ||
| ROCE | 2.86% | ||
| ROIC | 2.26% | ||
| ROICexc | 4.1% | ||
| ROICexgc | 6.1% | ||
| OM | 5.05% | ||
| PM (TTM) | 7.23% | ||
| GM | 63.13% | ||
| FCFM | 21.26% |
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-Score8
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 2.5 | ||
| Debt/EBITDA | 7.63 | ||
| Cap/Depr | 104.41% | ||
| Cap/Sales | 1.99% | ||
| Interest Coverage | 6.89 | ||
| Cash Conversion | 334.05% | ||
| Profit Quality | 294.03% | ||
| Current Ratio | 3.48 | ||
| Quick Ratio | 3.48 | ||
| Altman-Z | 10.44 |
F-Score8
WACC10.8%
ROIC/WACC0.21
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)63.28%
EPS 3YN/A
EPS 5Y16.12%
EPS Q2Q%53.49%
EPS Next Y14.46%
EPS Next 2Y21.56%
EPS Next 3Y22.63%
EPS Next 5Y19.37%
Revenue 1Y (TTM)22.8%
Revenue growth 3Y13.95%
Revenue growth 5Y10.13%
Sales Q2Q%26.53%
Revenue Next Year17.88%
Revenue Next 2Y16.52%
Revenue Next 3Y16.09%
Revenue Next 5Y14.46%
EBIT growth 1Y417.96%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year56.76%
EBIT Next 3Y39.95%
EBIT Next 5Y21.54%
FCF growth 1Y652.63%
FCF growth 3YN/A
FCF growth 5Y26.26%
OCF growth 1Y450.31%
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 14.46% in the next year.