Guidewire Software (GWRE) Q3 Earnings: What To Expect

Anthony Lee /
2023/05/31 2:56 am EDT

Insurance industry-focused software maker Guidewire (NYSE:GWRE) will be reporting results today after the bell. Here's what to expect.

Last quarter Guidewire Software reported revenues of $232.6 million, up 13.7% year on year, beating analyst revenue expectations by 4.21%. It was a solid quarter for the company, with a significant improvement in gross margin and a decent beat of analyst estimates.

Is Guidewire Software buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Guidewire Software's revenue to grow 8.39% year on year to $214 million, slowing down from the 20.4% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.14 per share.

Guidewire Software Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 3.62%.

Looking at Guidewire Software's peers in the software as a service segment, some of them have already reported Q3 earnings results, giving us a hint what we can expect. Manhattan Associates delivered top-line growth of 23.5% year on year, beating analyst estimates by 10.2% and Bill.com reported revenues up 63.3% year on year, exceeding estimates by 10.3%. Manhattan Associates traded flat on the results, Bill.com was up 11.4%. Read our full analysis of Manhattan Associates's results here and Bill.com's results here.

There has been positive sentiment among investors in the software, with the stocks up on average 15.4% over the last month. Guidewire Software is up 9.85% during the same time, and is heading into the earnings with analyst price target of $83.4, compared to share price of $81.6.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.