Pacific Crest Reiterates Outperform on Guidewire Software, FQ2 Expectations Remain Too High

In a report published Friday, Pacific Crest Securities analyst Brendan Barnicle reiterated an Outperform rating and $50.00 price target on Guidewire Software (NYSE: GWRE).

In the report, Pacific Crest Securities noted, “After meeting with Guidewire's CEO, Marcus Ryu, and CFO, Karen Blasing, we have greater confidence in Guidewire's long-term opportunity, but we are concerned that FQ2 expectations are too high. Our revenue estimates are about 5% lower than consensus, which we believe reflects seasonality. Management has not guided to FQ2. Our estimates mirror last year's seasonality. Last year, Q2 would have been 22.5% of annual revenue. We have Q2 at 21.9% of F14 revenue, compared to consensus to 23.3%. When asked about seasonality, Ms. Blasing said that there is no reason for seasonality to change this year.”

Guidewire Software closed on Thursday at $45.83.