DA Davidson lowers CommVault Systems stock price target on FX concerns

Published 16/07/2025, 15:44
DA Davidson lowers CommVault Systems stock price target on FX concerns

Investing.com - DA Davidson has lowered its price target on CommVault Systems (NASDAQ:CVLT) to $200.00 from $215.00 while maintaining a Buy rating on the stock. According to InvestingPro data, the stock currently trades at $171.23, with analyst targets ranging from $170 to $215, and 5 analysts have recently revised their earnings estimates upward.

The research firm cited foreign exchange (FX) considerations as a significant factor, noting it should provide a "~$30M Q/Q tailwind to reported FQ1 ARR" and potentially drive upward revisions to fiscal year 2026 guidance for revenue, operating profit, and free cash flow. The company has demonstrated strong performance with impressive revenue growth of 18.63% and industry-leading gross margins of 82.02%.

DA Davidson emphasized that first-quarter organic year-over-year annual recurring revenue (ARR) growth at constant currency and net new ARR (NNARR) at constant currency will be the most important metrics to watch.

The firm reported "relatively strong channel feedback" and expects some upside versus their first-quarter NNARR estimate of $32 million at constant currency, though they noted consensus estimates are higher at approximately $36.2-37.7 million.

Despite describing the current setup as "tricky to unfavorable," DA Davidson maintained its Buy rating, expressing expectations for "a continued re-rating higher in the shares over time."

In other recent news, Commvault Systems reported several significant developments. Guggenheim upgraded Commvault to a Buy rating, citing positive trends in data protection and projecting a substantial increase in the company’s annual recurring revenue. The firm expects Commvault to achieve organic constant currency net new annualized recurring revenue of approximately $41 million in the first quarter of fiscal year 2026, surpassing investor expectations. In personnel news, Commvault appointed Alan Atkinson as its first Chief Business Development Officer and Michelle Graff as Senior Vice President of Global Partners (NYSE:GLP) and Channel to enhance strategic partnerships and market opportunities. Additionally, Commvault announced a partnership with Kyndryl to improve cyber resilience services, which will be showcased at an industry conference. Commvault has also completed the sale of its headquarters in Tinton Falls, New Jersey, for $36 million, with a leaseback arrangement allowing continued operations at the site. Piper Sandler maintained a Neutral rating on Commvault, noting the company’s expanding partnerships and the ongoing transition from perpetual to subscription licenses. These recent developments highlight Commvault’s strategic moves in partnerships, leadership, and asset management.

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