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Investing.com - Raymond James has reiterated its Outperform rating on Guidewire (NYSE:GWRE) with a price target of $275.00 following the company’s fiscal first-quarter 2026 results. The stock currently trades at $215.76, giving the company a market capitalization of approximately $18.3 billion.
The software provider reported what Raymond James described as an "impressive" quarter that included record first-quarter bookings and a raised full-year outlook "across the board." InvestingPro data shows Guidewire maintains a strong financial position with liquid assets exceeding short-term obligations and a healthy current ratio of 2.77.
Annual recurring revenue (ARR) growth accelerated to 22% year-over-year in the quarter, aligning perfectly with the company’s overall revenue growth rate of 22.64% over the last twelve months. Raymond James highlighted building momentum across several core initiatives as reasons for its continued positive outlook on the stock, though investors should note the company trades at a substantial P/E ratio of 267.5.
The firm pointed to three key factors supporting its bullish stance: carriers recognizing the need to modernize with Guidewire as "the clear-cut leader in the cloud," an increasing pace of cloud migrations including The Hartford and Sompo in the first quarter, and potential greenfield opportunities in new modules such as UnderwritingCenter and PricingCenter with growing generative AI capabilities.
Raymond James noted that Guidewire shares are currently trading at approximately 11 times its fiscal 2027 sales estimate, with the firm viewing the risk/reward profile favorably given the company’s "long-term visibility in its model, strong competitive positioning, and what still appears to be a favorable fundamental setup" for fiscal year 2026. This assessment aligns with the broader analyst community, where price targets range from $160 to $305, with InvestingPro data indicating Guidewire has delivered a 27.99% year-to-date return. For deeper insights into Guidewire’s valuation metrics and 11 more exclusive ProTips, check out the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Guidewire Software Inc. reported its first-quarter earnings for fiscal year 2026, surpassing Wall Street expectations. The company achieved earnings per share of $0.66, outperforming the forecasted $0.61. Revenue reached $333 million, exceeding the anticipated $316.62 million. Additionally, Guidewire’s annual recurring revenue (ARR) reached $1,063 million, surpassing guidance by $11 million. This marked the largest first-quarter net new ARR since at least fiscal 2019, with a sequential net new ARR of $22 million. In light of these results, Goldman Sachs reiterated its Buy rating for Guidewire, maintaining a price target of $305.00. These developments highlight Guidewire’s strong performance and positive outlook, as noted by the analysts.
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