Clearwater Analytics Holdings, Inc. (CWAN): A Bull Case Theory

We came across a bullish thesis on Clearwater Analytics Holdings, Inc. on Business Invest’s Substack by Francesco Ferrari. In this article, we will summarize the bulls’ thesis on CWAN. Clearwater Analytics Holdings, Inc.’s share was trading at $19.55 as of August 20^th. CWAN’s trailing and forward P/E were 12.38 and 33.90 respectively according to Yahoo Finance.

Clearwater (CWAN) provides specialized services for investment and accounting firms, including hedge funds, aiming to automate compliance, reconciliation, and reporting tasks for complex portfolios. The company’s solutions target operational efficiency and accuracy for asset managers navigating intricate investment structures. A key question for investors is the revenue growth required to achieve a 2x return in five years from the current share price of $19.80.

A reverse DCF analysis indicates that Clearwater would need to grow revenues at an annual rate of 41.2% over the next five years to meet this target—well above historical trends and likely unrealistic. Given this, the focus shifts to identifying a price level where expected growth aligns with more reasonable, historical growth rates. That threshold is $10.89 per share, implying a 44% decline from the current price.

At this level, Clearwater would trigger a “deep dive” alert, signaling a potential opportunity for investors to re-evaluate the stock under more achievable growth assumptions. This approach not only establishes a first actionable price alert but also frames future monitoring, allowing investors to track the stock against clearly defined valuation and growth criteria. Overall, while Clearwater offers a compelling operational solution for asset managers, achieving aggressive return targets at the current price appears overly ambitious, making lower entry points essential for realistic investment planning.

Previously we covered a bullish thesis on Braze, Inc. (BRZE) by Elliot in May 2025, which highlighted the company’s real-time, cross-channel messaging platform, strong customer base, high switching costs, and emerging AI capabilities. The company’s stock price has depreciated approximately by 20.43% since our coverage due to macro pressures. The thesis still stands as Braze continues international expansion and AI investment. Francesco Ferrari shares a similar focus on operational efficiency but emphasizes Clearwater Analytics’ revenue growth and entry price alerts.

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Disclosure: None.