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Data Storage Corporation (DTST)
NASDAQ:DTST
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Data Storage
(NASDAQ:DTST)
65Neutral
Positive Factors
Recurring Revenue
Strong recurring revenue growth driven by the Cloud Infrastructure and Disaster Recovery segment.
Valuation
Shares trade at a lower multiple compared to a peer group average, indicating potential undervaluation.
Negative Factors
Sales Performance
Equipment and Software segment sales, which are discrete and prone to swings, declined significantly year over year.
Data Storage (DTST) vs. S&P 500 (SPY)
Market Cap
$27.03M
Dividend YieldN/A
Average Volume (3M)27.57K
Price to Earnings (P/E)53.1
Beta (1Y)1.56
Revenue Growth1.65%
EPS Growth31.84%
CountryUS
Employees53
SectorTechnology
Sector Strength63
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.07
Shares Outstanding7,094,081
10 Day Avg. Volume22,314
30 Day Avg. Volume27,571
Financial Highlights & Ratios
PEG Ratio1.67
Price to Book (P/B)N/A
Price to Sales (P/S)1.01
Price to Cash Flow (P/CF)32.20
P/FCF Ratio0.00
Enterprise Value/Market Cap0.66
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit1.87
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$9.00Price Target Upside136.22% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Data Storage Business Overview & Revenue Model
Company DescriptionData Storage Corporation provides multi-cloud information technology solutions primarily in the United States. The company offers data protection and disaster recovery solutions; high availability, data vaulting, DRaaS, IaaS, message logic, standby server, support and maintenance and internet solutions. It also provides cybersecurity solutions comprising managed endpoint security with active threat mitigation, system security assessment, and risk analysis services, as well as applications for continuous security and auditing; and voice and data solutions, such as VoIP and data services with fiber optic, coaxial, and wireless networks for businesses to connect from any location. The company offers its solutions and services to businesses in healthcare, banking and finance, distribution services, manufacturing, construction, education, and government sectors. Data Storage Corporation is headquartered in Melville, New York.
How the Company Makes MoneyData Storage Corporation generates revenue through a subscription-based model for its cloud services, including data backup and disaster recovery solutions. Customers pay recurring fees for access to DTST's secure and scalable cloud infrastructure. The company also earns money through the sale of professional services, such as consulting and system integration, which help clients optimize their data management strategies. Additionally, DTST may have partnerships with technology providers to enhance service offerings, though specific details on partnerships are not available.
Data Storage Financial Statement Overview
Summary
Data Storage presents a solid financial position with stable revenue growth and a strong equity base, though profitability and cash flow conversion present areas for improvement. The company shows resilience with low leverage and healthy cash flow metrics, providing a foundation for future growth.Income Statement
Data Storage shows a moderate revenue growth rate with a 0.74% increase in TTM compared to the previous year. Gross profit margin stands at a healthy 39.84%, while net profit margin is relatively low at 0.64%, indicating limited profitability. EBIT and EBITDA margins are -1.79% and 6.48% respectively, showing some operational challenges. Overall, the income statement reflects a stable revenue with potential for improved profitability.70
Positive
Balance Sheet
The balance sheet is strong with a solid equity ratio of 86.23%, indicating financial stability. The debt-to-equity ratio is low at 0.04, suggesting minimal leverage risk. ROE is low at 0.77%, reflecting modest returns on equity. The company's strong equity position provides a buffer for any financial volatility.75
Positive
Cash Flow
Cash flow analysis reveals a decline in free cash flow growth, but the operating cash flow to net income ratio is strong at 14.12, indicating effective cash generation from operations. The free cash flow to net income ratio is 5.30, showing efficient conversion of profits into cash. While there are fluctuations, the cash flow statement suggests adequate liquidity.68
Positive
| Breakdown | ||||
| Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 24.96M | 23.87M | 14.88M | 9.32M | 8.48M | Gross Profit |
| 9.58M | 8.08M | 6.42M | 3.90M | 3.74M | EBIT |
| -168.41K | -1.75M | -767.07K | 348.96K | 206.52K | EBITDA |
| 1.82M | -2.85M | 1.42M | 1.48M | 1.17M | Net Income Common Stockholders |
| 381.57K | -4.36M | 204.16K | -325.59K | -107.59K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 12.75M | 11.30M | 12.14M | 893.60K | 326.56K | Total Assets |
| 23.30M | 24.09M | 26.33M | 7.75M | 7.34M | Total Debt |
| 601.47K | 1.65M | 2.01M | 3.27M | 3.30M | Net Debt |
| -827.26K | -636.32K | -10.13M | 2.38M | 2.98M | Total Liabilities |
| 3.55M | 5.14M | 3.72M | 5.83M | 5.61M | Stockholders Equity |
| 19.99M | 19.10M | 22.72M | 2.02M | 1.80M |
| Cash Flow | Free Cash Flow | |||
| 2.33M | 536.54K | -816.52K | 929.61K | 759.31K | Operating Cash Flow |
| 3.87M | 663.80K | -360.69K | 1.11M | 799.67K | Investing Cash Flow |
| -3.85M | -9.14M | -6.42M | -181.07K | -40.35K | Financing Cash Flow |
| -878.79K | -1.37M | 18.02M | -362.57K | -661.54K |
Data Storage Technical Analysis
Neutral
3.81
Price Trends
3.63
Positive
4.04
Negative
4.10
Negative
Market Momentum
0.02
Negative
58.17
Neutral
89.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTST, the sentiment is Neutral. The current price of 3.81 is above the 20-day moving average (MA) of 3.48, above the 50-day MA of 3.63, and below the 200-day MA of 4.10, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 58.17 is Neutral, neither overbought nor oversold. The STOCH value of 89.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DTST.
Data Storage Risk Analysis
Data Storage disclosed 33 risk factors in its most recent earnings report. Data Storage reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Data Storage Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $27.03M | 53.14 | 2.53% | ― | 1.65% | 31.84% | |
65 Neutral | $43.48M | 13.56 | 19.32% | ― | -0.37% | ― | |
59 Neutral | $10.73B | 10.11 | -6.65% | 3.02% | 7.41% | -11.17% | |
51 Neutral | $27.66M | ― | -13.69% | ― | 34.47% | 54.37% | |
46 Neutral | $28.12M | ― | -1.97% | ― | 5.81% | 55.03% | |
38 Underperform | $13.99M | ― | ― | ― | ― |
* Technology Sector Average
Performance Comparison
DTST
Data Storage
3.81
-1.18
-23.65%
WYY
Widepoint
3.35
1.39
70.92%
USIO
Usio
1.64
0.15
10.07%
CLPS
Clps
1.01
0.15
17.44%
JFU
9F
1.24
-2.24
-64.37%
TDTH
Trident Digital Tech Holdings Ltd Unsponsored ADR
0.25
-3.73
-93.72%
Data Storage Earnings Call Summary
Earnings Call Date:Mar 31, 2025
(Q4-2024)
| % Change Since: 7.63%|
Next Earnings Date:May 19, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements in strategic expansion, financial performance, and client engagement. However, the modest revenue growth and increased expenses posed challenges. Positive momentum in recurring revenue and international expansion balanced these concerns.Q4-2024 Updates
Positive Updates
Revenue Growth and Transition
Total revenue grew by 2% to $25.4 million, reflecting a strategic transition towards subscription-based recurring revenue, with Cloud Infrastructure and Disaster Recovery Services revenue climbing 27% to $12.3 million.
Strong Financial Performance
Net income increased by 71% to $513,000, with adjusted EBITDA growing to $2.37 million from $1.64 million, showcasing margin expansion and efficient cost structure.
International Expansion and Strategic Milestones
Successful international expansion into the U.K. with the launch of CloudFirst Europe Limited, supported by partnerships and the deployment of three Tier 3 data centers.
Robust Organic Growth
CloudFirst achieved a compounded annual growth rate of 18% from Q1 2020 to Q1 2025, with a 30% CAGR including the merger of Flagship.
Client Engagement and Market Recognition
Secured significant contracts with major clients, including a 6-figure deal with a Japanese motorsport manufacturer and expanded services for a $1 billion insurance company.
Healthy Financial Position
The company ended the year with $12.3 million in cash and marketable securities with no debt, providing flexibility for future growth.
Negative Updates
Modest Top-Line Growth
Total revenue growth was modest at 2%, indicating challenges in achieving higher growth rates.
Increase in SG&A Expenses
Selling, general and administrative expenses increased by 13% to $11 million, driven by professional fees, stock-based salaries, and travel costs.
Decline in Onetime Revenue Streams
There was a decline in onetime hardware sales and a slight decrease in managed service revenue, aligning with the strategy to prioritize recurring revenue streams.
Company Guidance
During the Data Storage Corporation's Fiscal Year 2024 earnings call, the company reported a total revenue of $25.4 million, which marks a 2% increase from the previous year. The shift towards subscription-based recurring revenue was highlighted, as evidenced by the increased importance of the Cloud Infrastructure and Disaster Recovery Service segment, which saw a 27% year-over-year revenue climb to $12.3 million. This segment now constitutes 51% of the total revenue. The company achieved an annual recurring revenue run rate of $21.5 million, showcasing its strategic pivot towards more stable income streams. Net income improved significantly, rising by nearly 71% to $513,000, while adjusted EBITDA grew to $2.37 million from $1.64 million the prior year. The balance sheet remains robust with $12.3 million in cash and marketable securities and zero debt. The company also expanded its international presence with the establishment of CloudFirst Europe Limited and the deployment of three Tier 3 data centers in the U.K., contributing to its competitive edge in the cloud infrastructure market.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.