Update shared on21 Sep 2025
Fair value Increased 1.54%Guidewire Software’s analyst price target was raised to $268.38 as strong Q4 results, accelerating cloud deals, landmark client wins, and above-consensus long-term guidance reinforce market leadership and visibility.
Analyst Commentary
- Multiple bullish analysts highlight Guidewire's strong Q4 results, with broad-based beats driven by a record number of cloud deals (19), accelerating bookings, and subscription revenue up 33% year-over-year.
- Achievement and introduction of annual recurring revenue (ARR) surpassing $1B, with subscription gross margins reaching 70% and record-low ARR attrition, underscore increasing platform maturity and improved long-term visibility.
- The landmark 10-year cloud migration deal with Liberty Mutual serves as significant validation of Guidewire's cloud strategy and market positioning, further boosting confidence in sustained cloud momentum.
- Management’s introduction of FY26 guidance with midpoints for revenue, ARR, and operating income well above consensus and prior forecasts provides visibility and supports upward target revisions.
- Major firms (including JPMorgan) emphasize Guidewire’s dominance in its market, high customer retention due to mission-critical integrations, and ongoing cloud migration opportunity as drivers of further upside risk.
What's in the News
- Guidewire reported stronger-than-expected Q4 results, closed 19 cloud deals (up from 16 a year ago), and DA Davidson raised its price target to $250 with a Neutral rating; management issued FY26 guidance with midpoints for revenue, ARR, and operating income above consensus (Periodicals).
- Guidewire continues to expand cloud adoption, with MEMIC Group, LahiTapiola, Texas Windstorm Insurance Association, and Ascot U.S. all deploying or migrating core systems to Guidewire Cloud Platform in recent months (Key Developments).
- The company launched Niseko, a major new release featuring tools for enhanced financial insights, operational efficiency, modular business logic, improved customizability, advanced wildfire risk scoring, and automated underwriter assignments (Key Developments).
- Guidewire strengthened its commitment to the Japanese insurance market by collaborating with Capgemini and Nomura Research Institute to build out tailored PolicyCenter functionality for Japanese insurers directly on Guidewire Cloud (Key Developments).
- Guidewire experienced multiple index deletions in late June, falling out of several Russell value and small/midcap benchmarks, but did not repurchase any shares in the most recent buyback tranche, having previously completed just under 5% repurchase since September 2022 (Key Developments).
Valuation Changes
Summary of Valuation Changes for Guidewire Software
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $264.31 to $268.38.
- The Future P/E for Guidewire Software has significantly risen from 150.80x to 170.19x.
- The Net Profit Margin for Guidewire Software has significantly fallen from 10.73% to 9.45%.
Disclaimer
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