Guidewire Software (GWRE) Cut to “Sell” at Zacks Investment Research

Zacks Investment Research cut shares of Guidewire Software (NYSE:GWRE) from a hold rating to a sell rating in a report issued on Monday morning.

According to Zacks, “Guidewire Software is a provider of software solutions for property and casualty (P&C) insurers. Shares of the company have underformed the industry over the past three months.  The company is transforming to a subscription based model from a term license based one, which might hurt the top line in the near term. This is because the costs related to the shift will put pressure on margins in the near term and affect the top line as term license revenues include advance payments whereas subscription-based revenues are a bit delayed. Also, competition from peers adds to the woes. However, the company’s strategic partnership with Salesforce is expected to be a positive. Additionally, the company’s recent acquisition of Cyence is anticipated to enhance its product suite. Also, Guidewire’s cloud deployment partner, Amazon’s Web Services is also gaining momentum and this bodes well for it.”

A number of other research analysts have also weighed in on the company. TheStreet lowered Guidewire Software from a b rating to a c+ rating in a report on Wednesday, November 29th. Deutsche Bank restated a buy rating and issued a $85.00 target price on shares of Guidewire Software in a report on Thursday, November 30th. Citigroup set a $85.00 target price on Guidewire Software and gave the company a buy rating in a report on Thursday, November 30th. BidaskClub lowered Guidewire Software from a strong-buy rating to a buy rating in a report on Wednesday, October 18th. Finally, KeyCorp restated a buy rating and issued a $86.00 target price on shares of Guidewire Software in a report on Friday, September 29th. One equities research analyst has rated the stock with a sell rating, three have issued a hold rating, eight have given a buy rating and one has issued a strong buy rating to the company. The stock currently has an average rating of Buy and an average price target of $80.11.

Shares of Guidewire Software (NYSE:GWRE) traded up $0.04 during trading hours on Monday, reaching $77.08. The company’s stock had a trading volume of 905,700 shares, compared to its average volume of 588,580. The company has a market capitalization of $5,810.00, a price-to-earnings ratio of 308.32, a P/E/G ratio of 87.43 and a beta of 1.17. Guidewire Software has a 1-year low of $50.63 and a 1-year high of $83.52.

Guidewire Software (NYSE:GWRE) last posted its earnings results on Wednesday, November 29th. The technology company reported ($0.06) earnings per share for the quarter, missing the Zacks’ consensus estimate of $0.04 by ($0.10). Guidewire Software had a net margin of 3.82% and a return on equity of 3.29%. The company had revenue of $108.20 million during the quarter, compared to the consensus estimate of $100.61 million. During the same quarter in the prior year, the business earned $0.02 EPS. The firm’s revenue for the quarter was up 15.0% compared to the same quarter last year. equities analysts predict that Guidewire Software will post 0.06 earnings per share for the current year.

In related news, Director Craig Conway sold 600 shares of the stock in a transaction that occurred on Monday, October 16th. The stock was sold at an average price of $78.51, for a total transaction of $47,106.00. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, CFO Richard Hart sold 374 shares of the stock in a transaction that occurred on Friday, January 5th. The shares were sold at an average price of $77.00, for a total value of $28,798.00. Following the sale, the chief financial officer now directly owns 3,879 shares of the company’s stock, valued at $298,683. The disclosure for this sale can be found here. Insiders have sold 101,353 shares of company stock valued at $7,600,168 over the last ninety days. 0.69% of the stock is currently owned by company insiders.

A number of large investors have recently added to or reduced their stakes in GWRE. Janus Henderson Group PLC purchased a new stake in Guidewire Software in the second quarter worth $113,628,000. Atlantic Trust Group LLC purchased a new stake in Guidewire Software in the third quarter worth $39,989,000. Wasatch Advisors Inc. purchased a new stake in Guidewire Software in the second quarter worth $28,037,000. Koch Industries Inc. purchased a new stake in Guidewire Software in the second quarter worth $304,000. Finally, Fred Alger Management Inc. increased its position in Guidewire Software by 74.0% in the second quarter. Fred Alger Management Inc. now owns 408,182 shares of the technology company’s stock worth $28,046,000 after buying an additional 173,627 shares during the last quarter.

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About Guidewire Software

Guidewire Software, Inc is a provider of software products for property and casualty (P&C) insurers. The Company’s software serves as a technology platform for P&C insurance carriers. The Company’s InsurancePlatform consists of three elements: core transaction processing, data management and analytics, and digital engagement.

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