CommVault Systems Inc.
), an Enterprise Backup/Recovery software provider, delivered a 40%
positive surprise in the recently concluded first quarter of 2013.
This Zacks #1 Rank (Strong Buy) has posted an average earnings
surprise of 17% over the trailing four quarters, and its long-term
projected growth rate of 22% makes it a solid pick for growth.
Strong First Quarter
On July 31, CommVault reported that first quarter earnings surged
40% year over year to 21 cents per share, which exceeded the Zacks
Consensus Estimate by 6 cents (40%). The strong growth was
primarily driven by improved operating margin in the quarter.
Revenue jumped 21.6% from the prior-year quarter to $111.3 million,
slightly above the Zacks Consensus Estimate of $109.0 million. The
better-than-expected growth was driven by solid performances from
software (up 23.8%) and services (up 19.5%).
Higher revenues and stringent cost control helped operating margin
expansion of 390 basis points to 14.8%.
CommVault reiterated its fiscal 2013 outlook and continues to
expect double-digit revenue and operating income growth for fiscal
2013, on the back of strong enterprise demand. ComVault expects the
operating margin to expand 100 basis points in fiscal 2013.
Earnings Estimates Move Higher
Most analysts raised their forward estimates for both 2013 and 2014
over the last 30 days. For 2013, the Zacks Consensus Estimate
jumped 6% to 90 cents as six of seven estimates were revised
upward. For 2014, the Zacks Consensus Estimate of $1.06 improved
3.0% as five estimates out of seven moved upward.
Currently, CommVault is trading at a premium to most of its peers
based on P/E, P/S and P/B. Its strong earnings growth expectation
of 22.0% over the next five years compares favorably with the
industry average of 15%, indicating room for further significant
expansion. Moreover, its PEG ratio of 2.6 is lower than the
industry average of 4.6x.
Incorporated in 1996, CommVault develops software that primarily
helps enterprises to manage data and information. Through its
flagship Simpana brand, the company delivers different data
management activities including backup and recovery capabilities
for both onsite and cloud environments.
Oceanport, New Jersey based CommVault has a market capital of $2.35
billion and competes with EMC Corp. (
), Hewlett-Packard (
), IBM (
) and Symantec Corp. (
COMMVAULT SYSTM (CVLT): Free Stock Analysis
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