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 appears to be fairly valued based on its current 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 to peers, Block, Inc. has 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 relatively high within its industry.
Despite its high valuation ratios, Guidewire has outperformed the S&P 500 with a year-to-date return of 44.90% compared to the index's 13.30%, and a three-year return of 332.81% versus 81.19% for the S&P 500, suggesting strong market confidence in the company's future growth potential.