Oppenheimer analyst Param Singh initiated coverage on Commvault Systems, Inc. CVLT with an Outperform rating and a price forecast of $200.
According to the analyst, Commvault is benefiting from the increasing importance of data, which is driving growth in backup storage total addressable market.
The company is also gaining from the rise in data security breaches and ransomware attacks, which create new revenue opportunities, Singh adds.
As a leading provider of Backup-as-a-Service (BaaS) and Disaster Recovery-as-a-Service (DRaaS), Commvault is well-positioned to benefit from the shift to as-a-service platforms, the analyst writes.
Singh sees these factors to lead to strong customer growth, market share gains, and a 35% – 40% increase in SaaS Annual Recurring Revenue (ARR) over the next three years.
The analyst highlights that Commvault has adapted its offerings to support hybrid cloud and SaaS workloads while expanding into a SaaS delivery model.
This growth is expected to come at the expense of legacy competitors like Dell Technologies, IBM, and Veritas.
The analyst also highlights an analysis by Gartner, which recognizes Commvault’s ability to address hybrid cloud and SaaS workloads with its as-a-service cloud offerings, deeming its product best-in-class.
Singh estimates the company to report FY25 revenue of $957 million and pro forma EPS of $3.47.
Price Action: CVLT shares are trading higher by 3.58% to $175.75 at last check Wednesday.
Image via Isabela bela from Pixabay
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