Guidewire Software, Inc. (GWRE) vs Unity Software Inc. (U)

Guidewire Software, Inc. and Unity Software Inc. are both Software Application companies. Unity Software Inc. is the larger, with a market value of $19.1B against $14.4B — 1.3× the size. Unity Software Inc. has negative trailing earnings, so its P/E is not meaningful; Guidewire Software, Inc. trades at 102×. Guidewire Software, Inc. grew revenue faster over the last twelve months: 22.7% against 14.0%. Guidewire Software, Inc. has the higher net margin (9.44% vs −29.0%) and the higher return on invested capital (8.37% vs −13.2%). Across the 19 metrics below, Unity Software Inc. leads on 10 and Guidewire Software, Inc. on 9.

Valuation

Metric GWRE U Software Application median
P/E 101.72 n/m 25.41
P/S 9.64 8.72 2.73
P/B 11.91 5.82 2.57
Price to free cash flow 39.64 33.83 17.58
EV/EBITDA 68.02 n/m 15.36
EV/Sales 9.71 8.67 2.59
Earnings yield 0.98% (3.37%) 0.00%
Free cash flow yield 2.52% 2.96% 2.24%

Profitability

Metric GWRE U Software Application median
Gross margin 64.21% 64.85% 67.03%
Operating margin 10.16% (30.37%) 0.00%
Net margin 9.44% (28.97%) 0.00%
Free cash flow margin 24.31% 26.54% 5.01%
Return on equity 10.51% (18.85%) 0.00%
Return on assets 5.26% (8.78%) 0.00%
Return on invested capital 8.37% (13.16%) 0.00%

Growth

Metric GWRE U Software Application median
Revenue growth (TTM) 22.70% 13.98% 12.48%
EPS growth (last fiscal year) 101.23% 42.86% 32.26%
Revenue growth, 5-year CAGR 14.70% 19.08% 14.21%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric GWRE U Software Application median
Debt to equity 0.57 0.74 0.02
Current ratio 1.79 2.03 1.52
Net debt to EBITDA (0.36) (9.91) 0.08

Dividend

Metric GWRE U Software Application median
Dividend yield — — 0.95%
Payout ratio — — 0.29

Size

Metric GWRE U Software Application median
Market cap 14.41b 19.07b 357.77m

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