Clearwater Analytics (NYSE:CWAN) Shares Gap Up – Here’s Why

Shares of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) gapped up before the market opened on Monday . The stock had previously closed at $22.25, but opened at $24.13. Clearwater Analytics shares last traded at $24.1050, with a volume of 27,303,426 shares trading hands.

Clearwater Analytics News Roundup

Here are the key news stories impacting Clearwater Analytics this week:

• Positive Sentiment: Take-private deal announced: Permira and Warburg Pincus-led group agreed to acquire Clearwater for about $8.4B at $24.55 per share in cash — this offers a clear exit price and lifted the stock on takeover premium and deal certainty. Article Title
• Positive Sentiment: Broker support: Royal Bank of Canada reaffirmed an “Outperform” rating on CWAN, which can reinforce buyer confidence around the announced sale and valuation. Article Title
• Positive Sentiment: Heavy call-option activity: Unusually high call buying suggests traders are positioning for additional upside (possible competing bids during any go-shop period) or arbitrage around the buyout spread. Elevated option flows often accompany M&A situations. Article Title
• Neutral Sentiment: Analyst hold/market perform: William Blair reiterated a Market Perform rating, signaling mixed views on longer-term fundamentals once the company is private. This tempers bullishness for investors who focus on post-deal operational upside. Article Title
• Neutral Sentiment: Industry context: Recent competitor/peer analysis pieces put Clearwater’s valuation and growth profile in context, useful for investors assessing whether the buyout price is fair versus public comps. Article Title
• Negative Sentiment: Piper Sandler downgrade: Piper Sandler cut its rating on CWAN, which injects negative analyst sentiment and could weigh on any trading above the deal price if doubts persist. Article Title
• Negative Sentiment: Loop Capital downgrade: Another sell-side downgrade increases short-term pressure and highlights differing views on the company’s standalone prospects or deal premium. Article Title
• Negative Sentiment: Shareholder litigation scrutiny: Law firms (Halper Sadeh; Wohl & Fruchter) are investigating the fairness of the $24.55/share sale — this can prolong closing, raise legal/transactional risk, or pressure for a higher bid. Article Title Article Title

Wall Street Analyst Weigh In

A number of analysts recently weighed in on the stock. Oppenheimer lowered shares of Clearwater Analytics from an “outperform” rating to a “market perform” rating in a research report on Monday. Weiss Ratings restated a “hold (c)” rating on shares of Clearwater Analytics in a report on Monday. Zacks Research raised shares of Clearwater Analytics from a “strong sell” rating to a “hold” rating in a research note on Thursday, September 4th. William Blair reissued a “market perform” rating on shares of Clearwater Analytics in a research note on Monday. Finally, Royal Bank Of Canada restated an “outperform” rating and set a $36.00 price objective on shares of Clearwater Analytics in a report on Monday. Eight equities research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company’s stock. Based on data from MarketBeat, Clearwater Analytics presently has a consensus rating of “Moderate Buy” and a consensus price target of $28.65.

Clearwater Analytics Trading Up 0.2%

The company has a 50 day moving average of $20.12 and a two-hundred day moving average of $20.30. The stock has a market capitalization of $7.07 billion, a PE ratio of 15.79, a P/E/G ratio of 6.33 and a beta of 0.67. The company has a debt-to-equity ratio of 0.42, a quick ratio of 1.97 and a current ratio of 1.97.

Clearwater Analytics (NYSE:CWAN) last issued its quarterly earnings results on Wednesday, November 5th. The company reported $0.14 earnings per share for the quarter, missing analysts’ consensus estimates of $0.16 by ($0.02). The business had revenue of $205.11 million for the quarter, compared to analysts’ expectations of $203.66 million. Clearwater Analytics had a return on equity of 2.77% and a net margin of 61.28%.Clearwater Analytics’s revenue was up 77.1% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.14 EPS. Sell-side analysts predict that Clearwater Analytics Holdings, Inc. will post 0.18 EPS for the current year.

Clearwater Analytics declared that its board has initiated a stock repurchase plan on Wednesday, September 3rd that permits the company to repurchase $100.00 million in outstanding shares. This repurchase authorization permits the company to purchase up to 1.7% of its shares through open market purchases. Shares repurchase plans are often an indication that the company’s board of directors believes its shares are undervalued.

Insider Transactions at Clearwater Analytics

In other news, CEO Sandeep Sahai sold 16,592 shares of the stock in a transaction dated Tuesday, September 30th. The stock was sold at an average price of $17.68, for a total value of $293,346.56. Following the transaction, the chief executive officer directly owned 913,600 shares of the company’s stock, valued at approximately $16,152,448. This represents a 1.78% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CRO Scott Stanley Erickson sold 4,505 shares of Clearwater Analytics stock in a transaction dated Tuesday, September 30th. The stock was sold at an average price of $17.68, for a total value of $79,648.40. Following the sale, the executive directly owned 19,552 shares of the company’s stock, valued at $345,679.36. This trade represents a 18.73% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 120,727 shares of company stock worth $2,402,598. 3.31% of the stock is owned by insiders.

Hedge Funds Weigh In On Clearwater Analytics

A number of large investors have recently added to or reduced their stakes in CWAN. FNY Investment Advisers LLC lifted its holdings in Clearwater Analytics by 409.9% during the third quarter. FNY Investment Advisers LLC now owns 3,411 shares of the company’s stock valued at $61,000 after purchasing an additional 2,742 shares in the last quarter. Swiss Life Asset Management Ltd purchased a new position in Clearwater Analytics in the 3rd quarter valued at about $211,000. CIBC Bancorp USA Inc. acquired a new stake in Clearwater Analytics in the 3rd quarter worth about $474,000. Danske Bank A S acquired a new stake in Clearwater Analytics in the 3rd quarter worth about $36,000. Finally, Morningstar Investment Management LLC purchased a new stake in Clearwater Analytics during the 3rd quarter worth approximately $965,000. 50.10% of the stock is currently owned by institutional investors and hedge funds.

About Clearwater Analytics

Clearwater Analytics LLC is a global provider of web-based investment portfolio accounting, reporting, and analytics solutions. The company’s software-as-a-service platform automates complex processes involved in investment data aggregation, reconciliation, valuation, and regulatory reporting. Serving institutional investors—including insurers, asset managers, corporations, government entities, and asset owners—Clearwater Analytics enables clients to optimize performance visibility, risk management, and operational efficiency.

Founded in 2004 and headquartered in Boise, Idaho, Clearwater Analytics has grown its global footprint with offices across North America, Europe, and the Asia-Pacific region.