Guidewire Software Inc (GWRE)
Return on equity (ROE)
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -6,103 | -111,855 | -180,431 | -66,507 | -27,198 |
| Total stockholders’ equity | US$ in thousands | 1,342,730 | 1,199,470 | 1,451,660 | 1,544,890 | 1,656,770 |
| ROE | -0.45% | -9.33% | -12.43% | -4.30% | -1.64% |
July 31, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $-6,103K ÷ $1,342,730K
= -0.45%
Guidewire Software Inc's return on equity (ROE) has shown a declining trend over the past five years. In July 2020, the ROE was -1.64%, which worsened to -4.30% in July 2021. The trend continued to deteriorate with ROE dropping to -12.43% in July 2022 and further declining to -9.33% in July 2023. However, there was a slight improvement in July 2024, with ROE improving to -0.45%.
The consistently negative ROE indicates that Guidewire Software Inc has been generating lower profits relative to shareholders' equity during this period. This may be a cause for concern as it suggests that the company's profitability and efficiency in utilizing shareholders' equity have been weak. It is essential for the company to address the factors contributing to the negative ROE and implement strategies to enhance profitability in order to create value for shareholders.
Peer comparison
Jul 31, 2024