JPMorgan upgraded Clearwater Analytics (CWAN) to Overweight from Neutral with a price target of $33, up from $23, following the “strong” Q3 report. The firm says the jump in recurring revenue to 114% came as a surprise and was driven by the contribution of new products and limited churn. Top of the funnel demand appears incrementally stronger and was surprisingly broad based across types of customers and geographies, the analyst tells investors in a research note. JPMorgan believes Clearwater ‘s “significant valuation premium to peers is justified by an attractive combination” of high sales growth, improving profitability, and market share gains.
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