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Investing.com - RBC Capital has raised its price target on Guidewire (NYSE:GWRE) to $300 from $290 while maintaining an Outperform rating on the insurance software provider. Currently trading at $216.99, the stock has delivered an impressive 50.76% return over the past year, according to InvestingPro data.
The firm cited Guidewire’s strong fourth-quarter performance, which featured broad-based beats and continued cloud execution. The company closed fiscal year 2025 with annual recurring revenue (ARR) surpassing $1 billion, representing 19% year-over-year growth on a constant currency basis. InvestingPro analysis shows the company maintains a strong financial health score of "Good," with liquid assets exceeding short-term obligations.
Guidewire’s subscription revenue increased 33% year-over-year, while subscription gross margins reached 70%. RBC Capital highlighted a landmark 10-year deal with Liberty Mutual, combined with record-low ARR attrition and improving cloud margins, as indicators of increasing platform maturity.
For fiscal year 2026, Guidewire’s ARR guidance implies 17% growth at the midpoint, while its operating cash flow guidance of $350-370 million supports continued confidence in durable growth and expanding profitability.
RBC Capital’s new price target is based on approximately 17 times Guidewire’s calendar year 2026 estimated enterprise value to sales ratio.
In other recent news, Guidewire Software Inc. reported its fourth-quarter 2025 earnings, exceeding expectations with an earnings per share (EPS) of $0.84, compared to the forecast of $0.63. Revenue also surpassed predictions, reaching $356.57 million against the anticipated $337.85 million. This performance represents a 33.33% surprise in EPS, highlighting stronger-than-expected financial results. Despite the positive earnings report, the stock experienced a slight decline during regular trading hours. The company’s revenue and earnings figures are crucial indicators for investors, as they reflect the company’s financial health and operational efficiency. These results are part of recent developments surrounding Guidewire Software, offering insight into its current financial standing. Analyst opinions on the company’s future performance were not mentioned in the recent reports.
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