Market Pulse50Neutral

Guidewire Software, Inc.Opportunity Rank #240(GWRE) Intrinsic Value & DCF Analysis (2026)

Sector: Technology

Current Price

$156.81

Last updated: Mar 24, 2026

Price vs Intrinsic Value

$156.81
Price
$82.97
Intrinsic Value
Overvalued by 47%MOS: $66.38

Fundamental Score

45/100
Bearish

Weighted across 6 signals

Narrative Score

52/100
Weak

-5 vs previous

The intrinsic value of Guidewire Software, Inc. (GWRE) is estimated at $82.97 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $156.81, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes a 7.12% long-term growth rate and a 9.00% discount rate (calculated: 8.97%), reflecting expected future free cash flow and cost of capital.

The intrinsic value of Guidewire Software, Inc. (GWRE) is estimated at $82.97 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $156.81, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes a 7.12% long-term growth rate and a 9.00% discount rate (calculated: 8.97%), reflecting expected future free cash flow and cost of capital.

Valuation Details

$82.97
▼ -47.09% downside
20% margin of safety: $66.38
Years: 10Growth Rate: 7.12%
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Capital Efficiency

Average Quarterly ROIC
3.9%
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

45/100
BearishWeighted across 6 signals
DCF Discount
47.1% premium to price
0
FCF Yield
2.5% trailing FCF yield
13
ROIC vs WACC
ROIC 3.9% vs WACC 9.0% (0.4x)
22
Net Debt / FCF
Net cash position
100
Buybacks
Share count shrinking
80
FCF CAGR (5Y)
19.2% 5Y FCF CAGR
100
Strengths: Net Debt / FCF, Buybacks. Concerns: DCF Discount, FCF Yield.

Narrative Details

52/100
Weak
-5 vs previous · +1 new driversVs 6-Month Baseline:Low (5th pct)Weighted across 6 recent drivers
Trend: Deteriorating downConfidence: 89%Updated: 40m ago
Sources: 50 (42 News · 8 Analyst)
Drivers(last 30 days)
14 regulatory scrutiny-0.6
25 news sentiment+0.5
Upgrade headlines+0.1
Earnings beat+0.1
Downgrade headlines+0.0
8 analyst reiterations0.0

Investment Coach

Updated 19h ago
AVOIDConfidence: 66%
Thesis
Guidewire Software, Inc. is currently overvalued with its stock price trading approximately 46% above its estimated fair value, and its returns are trailing the estimated cost of capital. Despite a net cash balance sheet and positive free cash flow growth, the company's fundamentals and narrative trend are weak and deteriorating.
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.
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 trend or score direction.
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Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 7.12%5 Year CAGR: 18.93%

Free Cash Flow (in millions)

TTM202520242023202220212020201920182017201620152014201320122011201020092008
$334$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. provides software products for property and casualty insurers worldwide. The company offers Guidewire InsuranceSuite comprising Guidewire PolicyCenter, BillingCenter, and ClaimCenter applications. It also provides Guidewire InsuranceNow, a cloud-based platform that offers policy, billing, and claims management functionality to insurers; and Guidewire InsuranceSuite for Self-Managed. In addition, the company offers Guidewire Rating Management to manage the pricing of insurance products; Guidewire Reinsurance Management to use rules-based logic to execute reinsurance strategy through underwriting and claims processes; Guidewire Client Data Management to capitalize on customer information; and Guidewire Product Content Management that offers software tools and standards-based line-of-business templates to introduce and modify products. Further, it provides Guidewire Underwriting Management, a cloud-based integrated business application; Guidewire AppReader, a submission intake management solution; Guidewire ClaimCenter Package for the London market supports the claims workflow used by London Market insurers and brokers; Guidewire Digital Engagement Applications, which enable insurers to provide digital experiences to customers, agents, vendors, and field personnel through their device of choice; and Guidewire for Salesforce to provide customer information regarding policies and claims. Additionally, the company offers Guidewire Predictive Analytics, a set of cloud-native applications; Guidewire Risk Insights that allows insurers to assess new and evolving risks; Guidewire Business Intelligence that allows insurers to measure business performance; Guidewire DataHub, an operational data store; and Guidewire InfoCenter, a business intelligence warehouse, as well as implementation and integration, and professional services. The company was founded in 2001 and is headquartered in San Mateo, California.