Is Guidewire Software, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Guidewire Software, Inc. moved from expensive to fair. The company is currently fairly valued based on its valuation metrics. Key ratios include a P/E ratio of 241, a Price to Book Value of 15.80, and an EV to EBITDA of 329.55. In comparison, peers such as Block, Inc. have a P/E of 12.44 and an EV to EBITDA of 17.05, while Broadridge Financial Solutions, Inc. shows a P/E of 46.07 and an EV to EBITDA of 24.67, indicating that Guidewire's valuation is significantly higher than these competitors.
In terms of stock performance, Guidewire has outperformed the S&P 500 with a year-to-date return of 44.90% compared to the index's 13.30%. This strong performance, coupled with the fair valuation grade, suggests that while the stock may be trading at a premium relative to its peers, its recent returns reflect positive market sentiment.