Significant value was unlocked in Commvault Systems (CVLT +0.18%) stock on the final trading day of the week. Following a media report stating that its management is seriously considering a sale of the cybersecurity and data protection company, investors fell over themselves snapping up the stock. It ended Friday more than 10% higher in price.
Changing hands?
That morning, Reuters published an article stating that Commvault was mulling such a move after it drew takeover interest from several would-be suitors.
Image source: Getty Images.
Citing four unnamed "people familiar with the matter," the news agency added that the company has retained Goldman Sachs to help it sort through its options. The parties apparently interested in an acquisition include both private equity firms and potential strategic buyers. Among the former is Thoma Bravo, according to the article's sources.
Although cybersecurity stocks had a strong run with investors recently, they have since retreated amid worsening sentiment toward software companies. The segment is seen as vulnerable to disruption from artificial intelligence (AI).
NASDAQ: CVLT
Key Data Points
Someone might be getting a sweet deal
While I think that's a valid concern, Commvault isn't showing any sign of shrinking in the face of AI. In fact, it has enthusiastically embraced the technology, making it prominent in its popular Commvault Cloud platform.
The company's latest fundamentals were impressive, as it recorded 21% year-over-year revenue growth and a 23% improvement in net income not under generally accepted accounting principles. Given that, I'd expect it to be sold for a premium if it ends up with a new owner. And if it doesn't, it's currently bargain-priced with good potential for appreciation.
