GUIDEWIRE SOFTWARE INC (GWRE) Stock Fundamental Analysis
USA - NYSE:GWRE - US40171V1008 - Common Stock
233.64 USD
-2.78 (-1.18%)
233.64 USD
0 (0%)
Overall GWRE gets a fundamental rating of 5 out of 10. We evaluated GWRE against 285 industry peers in the Software industry. GWRE is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. GWRE shows excellent growth, but is valued quite expensive already.
1. Profitability
1.1 Basic Checks
In the past year GWRE was profitable.
GWRE had a positive operating cash flow in the past year.
In the past 5 years GWRE reported 4 times negative net income.
Of the past 5 years GWRE 4 years had a positive operating cash flow.
1.2 Ratios
GWRE's Return On Assets of 2.57% is fine compared to the rest of the industry. GWRE outperforms 66.67% of its industry peers.
GWRE has a better Return On Equity (4.79%) than 68.42% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.49%, GWRE is in the better half of the industry, outperforming 65.61% of the companies in the same industry.
| 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
The Profit Margin of GWRE (5.81%) is better than 68.42% of its industry peers.
Looking at the Operating Margin, with a value of 3.42%, GWRE is in the better half of the industry, outperforming 67.02% of the companies in the same industry.
The Gross Margin of GWRE (62.54%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of GWRE has grown nicely.
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), GWRE 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 10.12. This indicates that GWRE is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 10.12, GWRE belongs to the top of the industry, outperforming 85.61% 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.
With a decent Debt to FCF ratio value of 2.41, GWRE is doing good in the industry, outperforming 66.67% of the companies in the same industry.
GWRE has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of GWRE (0.46) is worse than 63.86% 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 | 0.46 | ||
| Debt/FCF | 2.41 | ||
| Altman-Z | 10.12 |
ROIC/WACC0.14
WACC10.96%
2.3 Liquidity
A Current Ratio of 2.77 indicates that GWRE has no problem at all paying its short term obligations.
GWRE's Current ratio of 2.77 is fine compared to the rest of the industry. GWRE outperforms 75.79% of its industry peers.
A Quick Ratio of 2.77 indicates that GWRE has no problem at all paying its short term obligations.
GWRE has a better Quick ratio (2.77) than 76.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.77 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 98.51% over the past year.
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
GWRE is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.37% yearly.
The Revenue is expected to grow by 14.46% on average over the next years. This is quite good.
EPS Next Y13.19%
EPS Next 2Y22.92%
EPS Next 3Y22.86%
EPS Next 5Y19.37%
Revenue Next Year17.88%
Revenue Next 2Y16.41%
Revenue Next 3Y15.84%
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
With a Price/Earnings ratio of 87.83, GWRE can be considered very expensive at the moment.
GWRE's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.10, GWRE is valued quite expensively.
Based on the Price/Forward Earnings ratio of 77.60, the valuation of GWRE can be described as expensive.
GWRE's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 22.52. GWRE is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 87.83 | ||
| Fwd PE | 77.6 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as GWRE.
GWRE's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 70.43 | ||
| EV/EBITDA | 293.99 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as GWRE's earnings are expected to grow with 22.86% in the coming years.
PEG (NY)6.66
PEG (5Y)5.45
EPS Next 2Y22.92%
EPS Next 3Y22.86%
5. Dividend
5.1 Amount
GWRE does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
233.64
-2.78 (-1.18%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners100.7%
Inst Owner Change0.36%
Ins Owners0.4%
Ins Owner Change-2.08%
Market Cap19.75B
Revenue(TTM)1.20B
Net Income(TTM)69.80M
Analysts80
Price Target271.76 (16.32%)
Short Float %1.72%
Short Ratio2
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)7.1%
EPS NQ rev (1m)1.08%
EPS NQ rev (3m)16.62%
EPS NY rev (1m)0.29%
EPS NY rev (3m)5.57%
Revenue NQ rev (1m)0.09%
Revenue NQ rev (3m)5.14%
Revenue NY rev (1m)0.21%
Revenue NY rev (3m)3.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 87.83 | ||
| Fwd PE | 77.6 | ||
| P/S | 16.42 | ||
| P/FCF | 70.43 | ||
| P/OCF | 65.64 | ||
| P/B | 13.55 | ||
| P/tB | 18.79 | ||
| EV/EBITDA | 293.99 |
EPS(TTM)2.66
EY1.14%
EPS(NY)3.01
Fwd EY1.29%
FCF(TTM)3.32
FCFY1.42%
OCF(TTM)3.56
OCFY1.52%
SpS14.23
BVpS17.24
TBVpS12.44
PEG (NY)6.66
PEG (5Y)5.45
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 | 10.12 |
F-Score7
WACC10.96%
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 Y13.19%
EPS Next 2Y22.92%
EPS Next 3Y22.86%
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 2Y16.41%
Revenue Next 3Y15.84%
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 13.19% in the next year.