COMMVAULT SYSTEMS INC (NASDAQ:CVLT): A Strong Growth Stock with Solid Fundamentals and Technical Breakout Potential

Combining basic and technical analysis can be an effective method for finding stocks with good growth prospects that also show positive price movement. The approach to choosing COMMVAULT SYSTEMS INC (NASDAQ:CVLT) involves looking for companies with steady earnings and revenue growth, good profitability, and sound financials, while also showing a technical breakout pattern. This dual approach helps identify stocks that are both financially stable and gaining traction in the market.

Why CVLT Is a Strong Growth Stock

Solid Fundamental Growth

The fundamental analysis for CVLT points to several important strengths:

• Growth Rating (8/10): The company has shown notable growth, with a 22.12% year-over-year rise in earnings per share (EPS) and an 8.21% annual revenue growth rate over recent years. Future estimates indicate further growth, with EPS expected to increase by 16.30% yearly.
• Profitability (7/10): CVLT has strong margins, including an 81.95% gross margin, better than 88.34% of its competitors in the software sector. Its return on equity (ROE) of 22.23% is higher than the industry average.
• Financial Health (7/10): The company has no debt, a good Altman-Z score (6.28), and positive cash flow, showing its stability.

These metrics fit the criteria of growth investing, where companies with rising earnings and scalable operations are favored. The full fundamental report offers more details on these strengths.

Technical Breakout Signals

From a technical standpoint, CVLT is showing positive signs:

• Trend Strength: Both short-term and long-term trends are upward, with the stock trading near the top of its 52-week range.
• Support & Resistance: The stock is hovering near a key resistance area between $191.45 and $193.38. A move above this level could suggest further gains.
• Relative Strength: CVLT has performed better than 78% of all stocks over the past year, showing strong market leadership.

The technical analysis report indicates a potential entry point above $193.39, with a stop-loss just below $190.98, offering a good risk-reward balance.

Why These Factors Are Important

Growth stocks with strong technical patterns often signal institutional interest and continued upward movement. By combining:

• Fundamental stability (ensuring the company has the earnings and financial strength to support growth), and
• Technical confirmation (showing market demand and price momentum),
  investors can lower risk while targeting stocks with high potential.

Find More Growth Stocks with Strong Patterns

For investors seeking similar opportunities, our Strong Growth Stocks with Good Technical Setup Ratings screen provides a selected list of stocks meeting these criteria.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always conduct your own research or consult a financial advisor before making investment decisions.