Head to Head Survey: Porch Group (NASDAQ:PRCH) versus Guidewire Software (NYSE:GWRE)

Porch Group (NASDAQ:PRCHGet Rating) and Guidewire Software (NYSE:GWREGet Rating) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Porch Group and Guidewire Software, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Porch Group 0 0 10 0 3.00
Guidewire Software 2 5 4 0 2.18

Porch Group presently has a consensus target price of $20.35, indicating a potential upside of 357.30%. Guidewire Software has a consensus target price of $117.90, indicating a potential upside of 51.93%. Given Porch Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe Porch Group is more favorable than Guidewire Software.

Earnings & Valuation

This table compares Porch Group and Guidewire Software’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Porch Group $192.43 million 2.27 -$106.61 million ($0.56) -7.95
Guidewire Software $743.27 million 8.72 -$66.51 million ($1.56) -49.74

Guidewire Software has higher revenue and earnings than Porch Group. Guidewire Software is trading at a lower price-to-earnings ratio than Porch Group, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Porch Group has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500. Comparatively, Guidewire Software has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.

Profitability

This table compares Porch Group and Guidewire Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Porch Group -21.81% -36.71% -8.02%
Guidewire Software -16.97% -6.50% -4.43%

Insider & Institutional Ownership

98.1% of Porch Group shares are held by institutional investors. 19.2% of Porch Group shares are held by insiders. Comparatively, 0.2% of Guidewire Software shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Guidewire Software beats Porch Group on 7 of the 13 factors compared between the two stocks.

About Porch Group (Get Rating)

Porch Group, Inc. operates a software platform in the United States and Canada. The company operates through two segments, Vertical Software and Insurance. The Vertical Software segment provides software and services to home services companies and gives early access to homebuyers and homeowners. It offers services to home services companies, such as home inspectors, consumers, such as homebuyers and homeowners, service providers, such as moving, insurance, warranty, and security companies, and TV/Internet providers. This segment operates through Floify, HireAHelper, ISN, iRoofing, Palm-Tech, Porch.com, Rynoh, and V12 brands. The Insurance segment offers property related insurance policies through our own risk-bearing carrier and independent agency as well as risk-bearing home warranty company. This segment operates though American Home Protect, Elite Insurance Group, and Homeowners of America brands. In addition, the company provides property and casualty, home, auto, flood, and umbrella insurance products; and contractor services. The company was incorporated in 2011 and is headquartered in Seattle, Washington.

About Guidewire Software (Get Rating)

Guidewire Software, Inc. provides software products for property and casualty insurers worldwide. The company offers Guidewire InsuranceSuite comprising Guidewire PolicyCenter, BillingCenter, and ClaimCenter applications. It also provides Guidewire InsuranceNow, a cloud-based platform that offers policy, billing, and claims management functionality to insurers; and Guidewire InsuranceSuite for Self-Managed. In addition, the company offers Guidewire Rating Management to manage the pricing of insurance products; Guidewire Reinsurance Management to use rules-based logic to execute reinsurance strategy through underwriting and claims processes; Guidewire Client Data Management to capitalize on customer information; and Guidewire Product Content Management that offers software tools and standards-based line-of-business templates to introduce and modify products. Further, it provides Guidewire Underwriting Management, a cloud-based integrated business application; Guidewire AppReader, a submission intake management solution; Guidewire ClaimCenter Package for the London market supports the claims workflow used by London Market insurers and brokers; Guidewire Digital Engagement Applications, which enable insurers to provide digital experiences to customers, agents, vendors, and field personnel through their device of choice; and Guidewire for Salesforce to provide customer information regarding policies and claims. Additionally, the company offers Guidewire Predictive Analytics, a set of cloud-native applications; Guidewire Risk Insights that allows insurers to assess new and evolving risks; Guidewire Business Intelligence that allows insurers to measure business performance; Guidewire DataHub, an operational data store; and Guidewire InfoCenter, a business intelligence warehouse, as well as implementation and integration, and professional services. The company was founded in 2001 and is headquartered in San Mateo, California.

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