Data Storage (DTST) AI Stock Analysis

• Market Cap: $29.99M
• Dividend Yield: N/A
• Average Volume (3M): 64.76K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.45
• Revenue Growth: 0.53%
• EPS Growth: -233.01%
• Country: US
• Employees: 53
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): -0.10
• Shares Outstanding: 7,262,436
• 10 Day Avg. Volume: 66,873
• 30 Day Avg. Volume: 64,763
• PEG Ratio: 1.59
• Price to Book (P/B): 1.37
• Price to Sales (P/S): 1.16
• P/FCF Ratio: -486.43
• Enterprise Value/Market Cap: 0.46
• Enterprise Value/Revenue: 0.54
• Enterprise Value/Gross Profit: 1.24
• Enterprise Value/Ebitda: 17.01
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: $4.50 ▲(7.91% Upside)

Data Storage Corporation's overall score reflects strong revenue growth and strategic initiatives, but is weighed down by profitability challenges, negative valuation metrics, and technical indicators suggesting bearish momentum. The proposed sale of CloudFirst offers potential for future value creation, but current dependency on its revenue is a risk.

Positive Factors

Revenue Growth

The company's strong revenue growth reflects its successful market expansion and increasing demand for its cloud services, supporting long-term business sustainability.

Strategic Growth Initiatives

Focusing on AI, cybersecurity, and SaaS positions the company for future growth in high-demand sectors, enhancing its competitive edge and market relevance.

Balance Sheet Health

A low debt-to-equity ratio indicates strong financial health, providing the company with flexibility to invest in growth opportunities without significant financial risk.

Negative Factors

Increased Operating Expenses

Rising operating expenses can pressure margins and profitability, potentially limiting the company's ability to reinvest in growth and affecting long-term financial performance.

Dependency on CloudFirst Revenue

High dependency on a single revenue source poses a risk to revenue stability, especially if the sale of CloudFirst affects future income streams.

Profitability Challenges

Ongoing net losses highlight the challenge of achieving profitability, which could impact the company's ability to sustain operations and invest in future growth.

Data Storage Business Overview & Revenue Model

Company Description

Data Storage (DTST) is a leading provider of innovative data management solutions, specializing in secure and scalable storage systems for businesses across various sectors, including healthcare, finance, and technology. The company offers a range of products and services, including cloud storage, data backup and recovery solutions, and data analytics tools, designed to help organizations efficiently manage and protect their critical information.

How the Company Makes Money

DTST generates revenue primarily through subscription-based models for its cloud storage services, which provide customers with flexible and scalable data storage solutions. The company also earns income from one-time sales of hardware products such as storage devices and servers. Additionally, DTST offers professional services, including data migration, consulting, and technical support, which contribute to its revenue streams. Strategic partnerships with major technology firms enhance its market reach and product offerings, further solidifying its financial performance.

Data Storage Financial Statement Overview

Summary

Data Storage shows strong revenue growth but faces challenges in profitability and cash flow management. The balance sheet is solid with low leverage, but the company needs to enhance its return on equity and cash flow efficiency to sustain long-term growth and profitability.

Income Statement

Data Storage shows a strong revenue growth trajectory with a TTM revenue growth rate of 93.7%, indicating robust expansion. However, profitability metrics such as the net profit margin and EBIT margin are weak, with the company reporting a negative EBIT and a low net profit margin of 0.75% for TTM. The gross profit margin remains healthy at 43.6%, suggesting efficient cost management at the gross level.

Balance Sheet

The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.03, indicating minimal leverage and financial risk. However, the return on equity is negative at -1.40% for TTM, highlighting inefficiencies in generating returns for shareholders. The equity ratio is strong, suggesting a solid capital structure.

Cash Flow

Cash flow analysis reveals challenges with negative free cash flow and a low operating cash flow to net income ratio of 0.19 for TTM. Despite a positive free cash flow growth rate, the negative free cash flow to net income ratio indicates cash flow issues. The company needs to improve its cash generation capabilities to support growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	25.46M	25.37M	24.96M	23.87M	14.88M	9.32M
Gross Profit	11.13M	11.10M	9.58M	8.08M	6.42M	3.90M
EBITDA	808.30K	2.11M	1.82M	-2.85M	1.27M	1.48M
Net Income	-298.62K	523.21K	381.57K	-4.36M	267.84K	-325.59K
Balance Sheet
Total Assets	24.42M	25.28M	23.30M	24.09M	26.33M	7.75M
Cash, Cash Equivalents and Short-Term Investments	11.12M	12.33M	12.75M	11.30M	12.14M	893.60K
Total Debt	574.18K	673.45K	601.47K	1.65M	2.01M	3.27M
Total Liabilities	3.19M	4.11M	3.55M	5.14M	3.72M	5.83M
Stockholders Equity	21.47M	21.42M	19.99M	19.10M	22.72M	2.02M
Cash Flow
Free Cash Flow	-718.79K	-60.27K	2.33M	536.54K	-816.52K	929.61K
Operating Cash Flow	657.81K	1.74M	3.87M	663.80K	-360.69K	1.11M
Investing Cash Flow	-672.78K	-1.74M	-3.85M	-9.14M	-6.42M	-181.07K
Financing Cash Flow	-161.06K	-352.96K	-878.79K	-1.37M	18.02M	-362.57K

Data Storage Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTST, the sentiment is Negative. The current price of 4.17 is below the 20-day moving average (MA) of 4.21, below the 50-day MA of 4.33, and above the 200-day MA of 4.03, indicating a neutral trend. The MACD of -0.04 indicates Negative momentum. The RSI at 46.62 is Neutral, neither overbought nor oversold. The STOCH value of 27.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DTST.

Data Storage Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
USIO	63 Neutral	$39.88M	13.93	16.71%	―	4.44%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
DTST	58 Neutral	$29.99M	-99.04	-1.42%	―	0.53%	-233.01%
GLE	54 Neutral	$9.62M	-12.84	-15.17%	―	-53.14%	-325.97%
CLPS	49 Neutral	$25.00M	-3.33	-11.94%	―	15.17%	-172.09%
CYCU	44 Neutral	$6.92M	―	-208.80%	―	―	-133.65%

Data Storage Corporate Events

Data Storage Sells Cloud Solutions Business

Data Storage Corporation has repurchased warrants issued in July 2021 for $2,049,388, which were exercisable for 858,750 shares of common stock. This repurchase was triggered by the sale of its cloud solutions business on September 11, 2025, impacting the company’s operations and market positioning.

The most recent analyst rating on (DTST) stock is a Hold with a $4.50 price target. To see the full list of analyst forecasts on Data Storage stock, see the DTST Stock Forecast page.

Data Storage Sells CloudFirst Business for $40 Million

On September 11, 2025, Data Storage Corporation completed the sale of its CloudFirst business to Performive, generating approximately $40 million in gross proceeds, with estimated net proceeds of $24 million after fees and adjustments. The company plans to use these proceeds to support strategic investments and acquisitions in technology sectors such as AI-enabled software, GPU technologies, and cybersecurity, while continuing to operate its telecommunications subsidiary, Nexxis, Inc. The transaction, approved by shareholders, positions Data Storage Corporation to pursue growth opportunities and enhance shareholder value.

The most recent analyst rating on (DTST) stock is a Hold with a $5.00 price target. To see the full list of analyst forecasts on Data Storage stock, see the DTST Stock Forecast page.

Data Storage Corp’s Earnings Call: Growth Amid Challenges

The recent earnings call of Data Storage Corporation presented a balanced outlook, highlighting significant growth in core services and a strategic shift towards transformative initiatives. Despite these positive developments, the company faces challenges such as increased net loss, rising operating expenses, and a heavy reliance on CloudFirst. The proposed sale of CloudFirst offers a potential reset for the company, aiming to unlock shareholder value and reinvest in future growth.

Data Storage to Divest Cloud Solutions Business

On August 8, 2025, Data Storage Corporation filed a definitive proxy statement with the SEC for its upcoming annual stockholders meeting on September 10, 2025. The meeting will address the proposed divestiture of its cloud solutions business, which includes selling all assets of its subsidiary, CloudFirst Technologies Corporation, and CloudFirst Europe Ltd. The company received letters from shareholders demanding additional disclosures regarding the divestiture, claiming omissions in the proxy statement. To avoid potential legal disputes and delays, Data Storage Corporation decided to voluntarily provide supplemental disclosures, although it maintains that the original disclosures were sufficient.

The most recent analyst rating on (DTST) stock is a Hold with a $5.00 price target. To see the full list of analyst forecasts on Data Storage stock, see the DTST Stock Forecast page.

Data Storage Corporation Reports Q2 2025 Earnings

Data Storage Corporation is a technology company focused on providing solutions for business continuity and efficiency, primarily operating in the cloud services sector. In its latest earnings report for the second quarter of 2025, the company reported a revenue increase of 4.8% year-over-year, reaching $5.1 million, driven by growth in subscription-based cloud services. The company maintained a consistent gross profit margin, with a total gross profit of $2.5 million, and ended the quarter with $11.1 million in cash and marketable securities, while carrying no long-term debt.