Clearwater Analytics Holdings, Inc. (CWAN)
Data & AnalyticsSaaS Metrics & Investor Data — Q1 2026
analyticsEditorial Financial Analysis
Financial Performance & Trajectory
Clearwater Analytics is demonstrating a powerful growth acceleration, with trailing revenue reaching $0.74B in Q1 2026, up from $0.63B in Q3 2025. The most striking development is the surge in year-over-year growth from 39.4% to 62.7%, indicating a significant inflection point, likely driven by large enterprise wins or platform adoption. However, this rapid scaling has created a notable margin trade-off. Gross margin compressed from 78.2% in Q3 2025 to 66.8% in Q1 2026, suggesting heavy investment in cloud infrastructure or lower-margin service components to capture market share. Free cash flow (FCF) margin also dipped sharply from 26.1% to 6.7% over the same period, pointing to elevated spending on sales, marketing, and implementation to fuel the growth engine.
Operational & Go-to-Market (GTM) Efficiency
The company’s Rule of 40 score has remained robust, rising from 65.5 in Q3 2025 to 84.3 in Q4 2025, before settling at 69.4 in Q1 2026. This is a world-class efficiency metric, driven by the combination of high growth and significant FCF generation—though the recent FCF margin compression bears watching. The absence of disclosed Net Revenue Retention (NRR) and CAC payback data limits a full GTM assessment, but the consistent Rule of 40 scores above 65 suggest that reinvestments in R&D and sales are yielding strong near-term returns. The Q1 2026 dip in FCF margin implies that the company is prioritizing top-line expansion over short-term profitability, a classic strategy for a high-growth asset manager seeking to cement its competitive moat.
Market Valuation & Sentiment
Despite the stellar growth, the market is pricing Clearwater with caution. The EV/Revenue multiple has contracted from 12.5x in Q3 2025 to 10.7x in Q1 2026, reflecting a tempered view of the margin compression and competitive dynamics. Wall Street sentiment is decidedly neutral, with a consensus Hold rating (3 Buys, 9 Holds, 1 Sell) and an average price target of $24.55. Insider activity is bearish, with net selling of -$705.1K and zero insider purchases in the last 10 filings. This insider behavior, combined with the tepid analyst outlook, suggests that while the growth story is compelling, the market is demanding proof of sustained profitability before re-rating the stock higher.
Disclaimer: The editorial financial analysis above is generated using data sourced from SEC EDGAR filings and Wall Street consensus ratings. This analysis is provided for informational and educational purposes only and does not constitute financial, investment, or professional advice. Readers should conduct their own research or consult with a registered financial advisor before making any investment decisions.
Clearwater Analytics Holdings, Inc. (CWAN) is a Data & Analytics SaaS company with a market cap of $7.3B as of Q1 2026. The company trades at 10.8x EV/Revenue and has delivered +62.7% revenue growth year-over-year. With a gross margin of 67% and FCF margin of 6.7%, Clearwater Analytics Holdings, Inc. scores 69 on the Rule of 40 — placing it in the top quartile of public SaaS companies tracked by SaaSDB.
compare_arrowsSector Benchmarking
Latest company metrics compared to the Data & Analytics sector medians
EV/Revenue is 10.8x (sector median: 10.5x) — trading at a premium of 0.3x relative to peers.
Rule of 40 is 69.4% (sector median: 39.7%) — outperforming peers by 29.7%.
Revenue Growth is 62.7% (sector median: 21.1%) — outperforming peers by 41.6%.
Gross Margin is 66.8% (sector median: 73.6%) — underperforming peers by 6.7%.
FCF Margin is 6.7% (sector median: 6.7%) — in-line with peers.
monitoringInvestor Metrics
From the makers of SaaSDB
Want a Full Research Brief on Clearwater Analytics Holdings, Inc.?
BriefStock runs real DCF, FCF yield, and P/E calculations from SEC filings — with 8-section research briefs updated after every earnings call.
rocket_launchFounder & Operator Metrics
Not publicly disclosed by this company: Net Revenue Retention·Gross Retention·ARR·ARR Growth·CAC Payback
trending_upEfficiency & Investment Trends
Insider Trading Activity
90-Day Insider Sentiment: Bearish / Net Selling. Insiders executed 2 sell transactions (totaling $487K) with zero buys. Last activity on Jun 8, 2026.
Analyst Ratings
From the makers of SaaSDB
Go deeper with BriefStock
SaaSDB shows you the benchmarks. BriefStock shows you whether the stock is fairly valued — with automated earnings transcripts, insider signal analysis, and institutional 13-F tracking.