Guidewire (GWRE) PT Raised to $90 at BofA/Merrill Lynch Following 2Q

BofA/Merrill Lynch raised its price target on Guidewire (NYSE: GWRE) to $90.00 (from $80.00) while maintaining a Neutral rating following the company's 2Q earnings report. Total revenue of $163.8 million exceeded $154.4 million estimates. EPS of $0.33 easily exceeded $0.19 from license/services upside, term license margin and scale on R&D and G&A.

Management raised guidance for FY18 revenue by $11 million to $647 million. The company lowered its expected contribution from the Cyence acquisition by $3 million, due to revised purchase price accounting offset by higher expected sales contribution in H2. GWRE raised FY18 EPS guidance by $0.13 at mid to $1.01 for services and term license upside and gross margin/opex scale.

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