What Happened?

Shares of data backup provider Commvault (NASDAQ: CVLT) jumped 3.2% in the morning session after Guggenheim upgraded the firm's stock to "Buy" from "Neutral". The investment firm also set a price target of $210, the highest on Wall Street, suggesting a significant potential upside from its previous closing price. Guggenheim analyst Howard Ma cited positive channel checks and strong underlying demand for data protection as key reasons for the bullish turn. The analyst noted that Commvault's software-as-a-service (SaaS) offering is gaining traction and is a preferred choice for complex, hybrid enterprise IT environments. Guggenheim anticipates that Commvault will outperform on key financial metrics at the start of its fiscal year 2026, forecasting both revenue growth and free cash flow margins to exceed 20%. This positive sentiment was echoed by the majority of analysts covering the stock, with a consensus "Moderate Buy" rating.

After the initial pop the shares cooled down to $169.46, up 1.6% from previous close.

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What Is The Market Telling Us

Commvault Systems’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 9 months ago when the stock gained 20.9% on the news that the company reported a "beat and raise" quarter. Third-quarter results exceeded analysts' expectations for key top line indicators, including ARR (annual recurring revenue) and billings. Notably, revenue growth accelerated, up 16% y/y (vs 13% y/y in the previous quarter), as management called out strong demand for the Commvault Cloud platform. 

Taking a closer look at the bottom line, EPS beat convincingly, and guidance also came in ahead of expectations. Zooming out, we think this was a very strong quarter.

Commvault Systems is up 11.4% since the beginning of the year, but at $169.46 per share, it is still trading 11.3% below its 52-week high of $190.99 from June 2025. Investors who bought $1,000 worth of Commvault Systems’s shares 5 years ago would now be looking at an investment worth $4,438.

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