CWAN Stock Forecast & Price Target

Clearwater Analytics Holdings has demonstrated a strong financial foundation, exhibiting over 30% adjusted EBITDA margins and a historical trend of improving adjusted EBITDA to free cash flow conversion, which underscores its financial stability. The company has recently raised its adjusted EBITDA guidance by 5%, reflecting confidence in its ability to capitalize on organic growth and expanding its product offerings, especially following significant acquisitions like Enfusion. With a projected long-term operating margin exceeding 30% and an anticipated 20%+ annual recurring revenue growth, Clearwater Analytics is well-positioned for sustained financial success as it leverages opportunities in both domestic and international markets.

Clearwater Analytics Holdings faces a negative outlook due to several fundamental risks, including the potential distraction from integrating recent acquisitions, such as Enfusion, which could hinder performance goals for both acquired and existing business operations. With a net leverage ratio of 3.5x as of Q2 2025, based on projected EBITDA, the company is under significant financial stress, which raises concerns about its ability to effectively manage debt while pursuing growth strategies. Additionally, ongoing pressures on investment managers' profitability and heightened competition from larger incumbents may negatively impact Clearwater’s market position and long-term financial stability.