Trade-Ideas: Guidewire Software (GWRE) Is Today's Pre-Market Mover With Heavy Volume Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Guidewire Software ( GWRE) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Guidewire Software as such a stock due to the following factors:

  • GWRE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.3 million.
  • GWRE traded 76,565 shares today in the pre-market hours as of 8:51 AM, representing 22.7% of its average daily volume.

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More details on GWRE:

Guidewire Software, Inc. provides system software to the property and casualty (P&C) insurance industry primarily in the United States, Canada, and Australia. Currently there are 3 analysts that rate Guidewire Software a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Guidewire Software has been 408,100 shares per day over the past 30 days. Guidewire Software has a market cap of $2.6 billion and is part of the technology sector and computer software & services industry.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Guidewire Software as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, premium valuation and weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 8.3%. Since the same quarter one year prior, revenues rose by 19.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • GWRE has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, GWRE has a quick ratio of 2.49, which demonstrates the ability of the company to cover short-term liquidity needs.
  • In comparison to the other companies in the Software industry and the overall market, GUIDEWIRE SOFTWARE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Software industry. The net income has significantly decreased by 184.8% when compared to the same quarter one year ago, falling from $3.15 million to -$2.67 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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