Guidewire Software's shares have gained 24% year to date, with strong revenue growth

From Nasdaq: 2024-06-21 07:56:00

Guidewire Software’s GWRE shares have outperformed in 2024 with a gain of 24.3% YTD. The company provides software solutions for P&C insurers with a cloud platform that aids in upgrading core operations. Earnings have beaten estimates for four consecutive quarters. Revenues rose 16% year over year to $240.7 million in the last reported quarter.

An increasing focus on cloud strategy has boosted sales for Guidewire, with revenues surpassing estimates. Guidewire Cloud saw significant growth with eight deal wins in the reported quarter. Management expects total revenues for fiscal 2024 to be between $968 million and $976 million, with cash flow from operations estimated to be $130-$150 million.

Guidewire’s subscription and support segment’s gross margin increased to 65.5% year over year due to improved cloud infrastructure efficiency. The company raised its guidance for 2024, with estimates projecting revenue growth of 7.2% and 11.6% for fiscal 2024 and 2025, respectively. The stock is currently a Zacks Rank #3 (Hold).

While Guidewire continues to see growth, rising research and development costs and integration risks remain areas of concern. The company’s total operating expenses increased 1.4% year over year in the last reported quarter. Despite this, analysts remain optimistic about the company’s future prospects.

Other strong stocks in the technology sector include Alphabet, Arista Networks, and Woodward, each currently sporting a Zacks Rank #1 (Strong Buy). These companies have seen significant earnings growth and stock price increases in the past year, making them good options for investors looking for solid returns in the tech industry.



Read more at Nasdaq: Guidewire (GWRE) Gains 24% Year to Date: Will the Rally Last?