Guidewire price target raised by $11 at BofA, here’s why

BofA raised the firm’s price target on Guidewire to $80 from $69 and keeps an Underperform rating on the shares. Fiscal Q1 results beat expectations on strong deal closures in a seasonally weak quarter, but Guidewire elected not to increase FY24 topline guidance despite the revenue beat, which slightly de-risks the guidance, but suggest to the firm that some uncertainty remains from a deal ramp and demand perspective entering calendar 2024, the analyst tells investors. The firm updated its estimates for the revised guidance and increased its target multiple based on margin expansion progress, but it still believes risk/reward is more attractive in other software stocks.