Financial Contrast: Guidewire Software (GWRE) and Its Rivals

Guidewire Software (NYSE:GWRE) is one of 953 publicly-traded companies in the “Software” industry, but how does it compare to its peers? We will compare Guidewire Software to related businesses based on the strength of its profitability, valuation, earnings, analyst recommendations, institutional ownership, dividends and risk.

Profitability

This table compares Guidewire Software and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Guidewire Software	9.44%	12.66%	6.73%
Guidewire Software Competitors	-607.02%	22.93%	-8.85%

Insider and Institutional Ownership

41.8% of shares of all “Software” companies are owned by institutional investors. 0.5% of Guidewire Software shares are owned by insiders. Comparatively, 19.9% of shares of all “Software” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Guidewire Software and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Guidewire Software	$1.48 billion	$139.28 million	98.95
Guidewire Software Competitors	$1.92 billion	$387.74 million	108.83

Guidewire Software’s peers have higher revenue and earnings than Guidewire Software. Guidewire Software is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility and Risk

Guidewire Software has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Guidewire Software’s peers have a beta of 1.34, indicating that their average stock price is 34% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Guidewire Software and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Guidewire Software	0	4	12	0	2.75
Guidewire Software Competitors	5749	21530	44888	1497	2.57

Guidewire Software presently has a consensus target price of $216.23, indicating a potential upside of 34.06%. As a group, “Software” companies have a potential upside of 29.49%. Given Guidewire Software’s stronger consensus rating and higher probable upside, research analysts clearly believe Guidewire Software is more favorable than its peers.

Summary

Guidewire Software peers beat Guidewire Software on 8 of the 13 factors compared.

About Guidewire Software

Guidewire Software, Inc. provides a platform for property and casualty (P&C) insurers worldwide. The company offers Guidewire InsuranceSuite Cloud, such as PolicyCenter Cloud, BillingCenter Cloud, and ClaimCenter Cloud applications. It also provides Guidewire InsuranceNow, a cloud-based platform that offers policy, billing, and claims management functionality to insurers; and Guidewire InsuranceSuite for Self-Managed. In addition, the company offers Guidewire Rating Management to manage the pricing of insurance products; and Guidewire Reinsurance Management to use rules-based logic to execute reinsurance strategy through underwriting and claims processes. Further, it provides Guidewire Underwriting Management, a cloud-based integrated business application; Guidewire AppReader, a submission intake management solution; Guidewire ClaimCenter Package for the London market supports the claims workflow used by London Market insurers and brokers; Guidewire Digital Engagement Applications, which enable insurers to provide digital experiences to customers, agents, vendors, and field personnel through their device of choice; and Guidewire for Salesforce to provide customer information regarding policies and claims. Additionally, the company offers Guidewire Predict, a P&C-specific machine-learning platform; Guidewire HazardHub that allows insurers to understand, assess, price, and manage property risk; Guidewire Canvas, Guidewire Compare, and Guidewire Explore cloud-native applications; and Guidewire Cyence, a cyber-risk economic modeling product. The company was incorporated in 2001 and is headquartered in San Mateo, California.