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Guidewire Software Inc (GWRE): Are Hedge Funds Right About This Stock?

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What’s a smart Guidewire Software Inc (NYSE:GWRE) investor to do?

In today’s marketplace, there are tons of gauges shareholders can use to watch their holdings. A pair of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite money managers can outpace their index-focused peers by a very impressive amount (see just how much).

Equally as key, positive insider trading activity is another way to analyze the financial markets. Just as you’d expect, there are many motivations for an insider to get rid of shares of his or her company, but only one, very clear reason why they would buy. Many academic studies have demonstrated the valuable potential of this tactic if piggybackers know what to do (learn more here).

Furthermore, let’s study the latest info surrounding Guidewire Software Inc (NYSE:GWRE).

Guidewire Software Inc (NYSE:GWRE)

What have hedge funds been doing with Guidewire Software Inc (NYSE:GWRE)?

At Q2’s end, a total of 12 of the hedge funds we track were long in this stock, a change of -14% from the previous quarter. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were increasing their holdings substantially.

When using filings from the hedgies we track, Panayotis Sparaggis’s Alkeon Capital Management had the biggest position in Guidewire Software Inc (NYSE:GWRE), worth close to $41.1 million, comprising 0.9% of its total 13F portfolio. The second largest stake is held by John Murphy of Alydar Capital, with a $34.6 million position; 1.9% of its 13F portfolio is allocated to the company. Other hedge funds that are bullish include Matthew Iorio’s White Elm Capital, Drew Cupps’s Cupps Capital Management and Richard Driehaus’s Driehaus Capital.

Due to the fact Guidewire Software Inc (NYSE:GWRE) has experienced dropping sentiment from the entirety of the hedge funds we track, it’s safe to say that there lies a certain “tier” of fund managers that decided to sell off their entire stakes last quarter. Intriguingly, Steven Cohen’s SAC Capital Advisors cut the biggest position of all the hedgies we monitor, comprising an estimated $3.5 million in stock. Scott Fine and Peter Richards’s fund, Empire Capital Management, also cut its stock, about $2.9 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 2 funds last quarter.

Insider trading activity in Guidewire Software Inc (NYSE:GWRE)

Insider buying made by high-level executives is particularly usable when the company in question has experienced transactions within the past half-year. Over the last six-month time frame, Guidewire Software Inc (NYSE:GWRE) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also review the relationship between both of these indicators in other stocks similar to Guidewire Software Inc (NYSE:GWRE). These stocks are Sapient Corporation (NASDAQ:SAPE), Convergys Corporation (NYSE:CVG), Verint Systems Inc. (NASDAQ:VRNT), SS and C Technologies Holdings Inc (NASDAQ:SSNC), and Qlik Technologies Inc (NASDAQ:QLIK). This group of stocks are the members of the business software & services industry and their market caps resemble GWRE’s market cap.

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