Is Guidewire Software (GWRE) Still a Great Investment Pick?

Weitz Investment Management, an investment management firm, published its “Hickory Fund” fourth quarter 2021 investor letter – a copy of which can be downloaded here. A return of +6.54% was recorded by the fund in the fourth quarter of 2021, outperforming its Russell Midcap benchmark that delivered a +6.44% return. For the calendar year, the Fund returned +20.32% compared to +22.58% for the index. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Weitz Investment Management Hickory Fund in its Q4 2021 investor letter, mentioned Guidewire Software, Inc. (NYSE: GWRE) and discussed its stance on the firm. Guidewire Software, Inc. is a San Mateo, California-based software company with an $8.0 billion market capitalization. GWRE delivered a -14.60% return since the beginning of the year, while its 12-month returns are down by -20.12%. The stock closed at $96.95 per share on February 4, 2022.

Here is what Weitz Investment Management Hickory Fund has to say about Guidewire Software, Inc. in its Q4 2021 investor letter:

“In the second half of the year, resurgent inflation and higher interest rate fears reined in investor appetite for higher-growth assets trading at premium multiples. Within our portfolio, this has included enterprise software provider Guidewire – our chief detractors from calendar year performance. Each is a leader in its respective, specific market, and we continue to have a lot of confidence in the long-term outlook for each. We also note that our investment thesis has always contemplated a higher-interest-rate environment. While this rotation may reasonably bring some market “highflyers” back to Earth, we continue to watch for opportunities to add to these terrific businesses should further pressure yield attractive prices.”

Our calculations show that Guidewire Software, Inc. (NYSE: GWRE) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. GWRE was in 26 hedge fund portfolios at the end of the third quarter of 2021, compared to 27 funds in the previous quarter. Guidewire Software, Inc. (NYSE: GWRE) delivered a -22.85% return in the past 3 months.

In May 2021, we also shared another hedge fund’s views on GWRE in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.