Market Pulse53Neutral

Guidewire Software, Inc.Opportunity Rank #247(GWRE) Intrinsic Value & DCF Analysis (2026)

Sector: Technology

Current Price

$131.38

Last updated: Jul 24, 2026

Price vs Intrinsic Value

$131.38
Price
$70.00
Intrinsic Value
Overvalued by 47%MOS: $56.00

Fundamental Score

46/100
Bearish

Weighted across 6 signals

Narrative Score

49/100
Weak

No change vs previous

Trend Score

46/100
Neutral

As of 2026-07-24

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The intrinsic value of Guidewire Software, Inc. (GWRE) is estimated at $70.00 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $131.38, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes a 6.98% long-term growth rate and a 9.00% discount rate (calculated: 8.43%), reflecting expected future free cash flow and cost of capital.

The intrinsic value of Guidewire Software, Inc. (GWRE) is estimated at $70.00 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $131.38, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes a 6.98% long-term growth rate and a 9.00% discount rate (calculated: 8.43%), reflecting expected future free cash flow and cost of capital.

Valuation Details

$70.00
-46.72% downside
20% margin of safety: $56.00
Years: 10Growth Rate: 6.98%
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Capital Efficiency

Average Quarterly ROIC
3.81%
Cost of Capital (estimated)9%
Value StatusUnderperforming Capital

The company is earning below its required return. This may indicate inefficient use of capital or excess cash that isn't being reinvested.

Complete historical ROIC is available with
.

Fundamental Details

46/100
BearishWeighted across 6 signals
DCF Discount
46.7% premium to price
0
FCF Yield
2.7% trailing FCF yield
16
ROIC vs WACC
ROIC 3.8% vs WACC 9.0% (0.4x)
21
Net Debt / FCF
Net cash position
100
Buybacks
Share count shrinking
80
FCF CAGR (5Y)
16.0% 5Y FCF CAGR
100
Strengths: Net Debt / FCF, Buybacks. Concerns: DCF Discount, FCF Yield.

Narrative Details

49/100
Weak
Vs 6-Month Baseline:Low (1st pct)Weighted across 4 recent drivers
Trend: Deteriorating downConfidence: 89%Updated: 1d ago
Sources: 42 (29 News · 13 Analyst)
Drivers(last 30 days)
3 regulatory scrutiny-0.3
25 news sentiment+0.2
Earnings beat+0.0
13 analyst reiterations0.0

Trend Details

46/100
NeutralAs of 2026-07-24310 daily bars used
Distance from 52-Week High-47.2%
6M Relative Strength vs SPY-19.1%
Price vs 50 EMA+2.5%
Price vs 21 EMA60 · +1.6%
Price vs 50 EMA62 · +2.5%
21 EMA vs 50 EMA58 · +0.9%
3M RS vs SPY54 · +1.0%
6M RS vs SPY11 · -19.1%
Distance from 52W High6 · -47.2%

Investment Coach

Updating... 45d ago
AVOIDConfidence: 59%
Thesis
Guidewire Software, Inc. is currently overvalued with its market price approximately 47.6% above the estimated fair value, and its returns are trailing the estimated cost of capital despite a strong and improving narrative score. The company maintains a healthy balance sheet with net cash and demonstrates positive free cash flow growth and buybacks.
Key Risk
The key risk is that the company’s return on invested capital remains below its weighted average cost of capital, indicating potential value destruction if this trend continues.
Signals To Watch
  • Price moves to at least a mid-teens discount to fair value
  • Sustained improvement in ROIC versus WACC spread
  • Meaningful shifts in the narrative score direction
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 6.98%5 Year CAGR: 15.68%

Free Cash Flow (in millions)

TTM202520242023202220212020201920182017201620152014201320122011201020092008
$291$307$214$56-$16$140$139$165$152$144$107$70$80$42$23$30$12$13-$2

How Intrinziq Estimates Fair Value

Intrinziq estimates Guidewire Software, Inc.'s intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

Guidewire Software, Inc.Technology

Guidewire Software, Inc. is a global supplier of software solutions tailored for the property and casualty insurance industry. Its primary offering is Guidewire InsuranceSuite, a comprehensive platform that incorporates core applications like PolicyCenter, BillingCenter, and ClaimCenter. The company also furnishes Guidewire InsuranceNow, a cloud-native platform providing integrated policy, billing, and claims administration for insurers, alongside a self-managed version of the InsuranceSuite. Guidewire's product portfolio extends to specialized management tools, including Rating Management for accurate insurance product pricing, Reinsurance Management for executing rules-based reinsurance strategies throughout underwriting and claims processes, Client Data Management for effective utilization of customer information, and Product Content Management, which provides software tools and standardized templates to streamline the introduction and modification of insurance products. Further innovative solutions encompass Guidewire Underwriting Management, a cloud-based business application; AppReader, designed for efficient submission intake; a specialized Guidewire ClaimCenter Package that supports the unique claims workflows of the London Market; Digital Engagement Applications enabling insurers to deliver seamless digital experiences to customers, agents, and vendors across various devices; and Guidewire for Salesforce, which integrates crucial customer policy and claims data. Additionally, the company provides a robust data and analytics suite, featuring cloud-native Predictive Analytics applications, Risk Insights to help insurers evaluate emerging risks, Business Intelligence tools for performance measurement, DataHub as an operational data store, and InfoCenter for business intelligence warehousing. Guidewire also offers extensive implementation, integration, and professional services to support its clients. Established in 2001, Guidewire Software, Inc. maintains its corporate headquarters in San Mateo, California.