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Why Guidewire Software Shares Skyrocketed

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Guidewire Software (NYSE: GWRE  ) have skyrocketed today by as much as 21% after the company reported strong earnings.

So what: Revenue in the fiscal second quarter came in at $72.2 million, easily crushing the consensus estimate of just $64.3 million. The non-GAAP earnings per share of $0.21 similarly made short work of the mere $0.02 per share adjusted profit that the Street was modeling for. The results topped the high end of Guidewire's guidance range.

Now what: CEO Marcus Ryu said several customers made payments earlier than needed, which helped boost results, and the company has been able to up-sell many existing customers. At least two analysts are encouraged. Deutsche Bank boosted its price target from $38 to $41 while keeping a buy rating, seeing opportunity in geographic expansion. UBS followed suit and was encouraged by strong guidance that calls for 2013 sales to grow by 23% to 26%.

Interested in more info on Guidewire? Add it to your watchlist by clicking here.

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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 27, 2013, at 5:12 PM, constructive wrote:

    Non-GAAP numbers are worthless. Do your readers a favor and report GAAP numbers too.

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Evan Niu

Evan is a Senior Technology Specialist at The Motley Fool. He was previously a Senior Trading Specialist at a major discount broker. Evan graduated from the University of Texas at Austin, and is a CFA charterholder.

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11/30/2015 12:40 PM
GWRE $59.63 Down -0.52 -0.86%