Data Storage (NASDAQ:DTST) Issues Earnings Results

Data Storage (NASDAQ:DTST) posted its earnings results on Friday. The company reported ($0.53) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($0.29) by ($0.24), Zacks reports. The company had revenue of $0.36 million during the quarter, compared to analyst estimates of $0.40 million.

Here are the key takeaways from Data Storage’s conference call:

• Nexxis revenue from continuing operations rose 9.3% year over year to $359,000, while gross profit increased 21.9% to $168,000 and gross margin improved to 47% from 42.1%, supported by new customers, higher existing-customer spending, favorable mix, and operating leverage.
• Data Storage ended the quarter with approximately $9.3 million in cash and marketable securities and no long-term debt, providing flexibility to pursue acquisitions, strategic investments, and internally developed initiatives.
• The company’s net loss attributable to common shareholders widened to $1.2 million from $732,000, as SG&A rose 33.2% to $1.5 million, driven primarily by higher non-cash stock compensation and professional fees.
• Management is evaluating more than 100 potential opportunities across cybersecurity, AI infrastructure, telecommunications, software, and related markets, but remains cautious about unrealistic valuations and is not yet ready to announce a transaction.
• Management said it would like to sign a nonbinding letter of intent within 45–60 days and close an acquisition by late fourth quarter 2026 or the first quarter of 2027, likely using a combination of cash, stock, and earn-out structures to limit risk and align seller incentives.

Data Storage Stock Down 14.5%

Data Storage stock traded down $0.52 during trading hours on Friday, reaching $3.06. 87,873 shares of the company’s stock were exchanged, compared to its average volume of 13,159. The firm’s 50 day simple moving average is $3.32 and its 200 day simple moving average is $3.81. The firm has a market capitalization of $7.15 million, a PE ratio of -9.27 and a beta of 1.15. Data Storage has a twelve month low of $2.85 and a twelve month high of $5.15.

Wall Street Analyst Weigh In

Separately, Weiss Ratings restated a “hold (c)” rating on shares of Data Storage in a research report on Thursday, July 2nd. Two research analysts have rated the stock with a Hold rating, Based on data from MarketBeat, Data Storage has a consensus rating of “Hold”.

Insider Activity at Data Storage

In related news, CEO Charles M. Piluso sold 32,610 shares of Data Storage stock in a transaction on Tuesday, May 26th. The stock was sold at an average price of $3.82, for a total transaction of $124,570.20. Following the sale, the chief executive officer directly owned 223,074 shares in the company, valued at approximately $852,142.68. This trade represents a 12.75% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 86,958 shares of company stock worth $333,310 over the last three months. Company insiders own 21.20% of the company’s stock.

Institutional Investors Weigh In On Data Storage

Several large investors have recently added to or reduced their stakes in DTST. Renaissance Technologies LLC boosted its position in shares of Data Storage by 54.8% during the 4th quarter. Renaissance Technologies LLC now owns 136,100 shares of the company’s stock valued at $697,000 after acquiring an additional 48,200 shares during the last quarter. Rothschild Wealth LLC bought a new stake in shares of Data Storage in the 4th quarter valued at about $205,000. Elevation Point Wealth Partners LLC purchased a new position in Data Storage during the 3rd quarter valued at about $186,000. Dimensional Fund Advisors LP increased its stake in shares of Data Storage by 15.1% during the third quarter. Dimensional Fund Advisors LP now owns 37,574 shares of the company’s stock valued at $162,000 after buying an additional 4,920 shares during the period. Finally, XTX Topco Ltd bought a new stake in shares of Data Storage in the 4th quarter worth approximately $134,000. Hedge funds and other institutional investors own 11.56% of the company’s stock.

About Data Storage

Data Storage Corporation provides data management and cloud solutions in the United States and internationally. It offers a suite of multi-cloud IT solutions, including cyber security solutions, which comprise ezSecurity, a security solution for endpoint security, system assessments, and risk analysis, as well as IBM system protection, including Ransomware defense. The company also provides data protection and recovery solutions, such as ezVault for offsite data protection; ezRecovery for fast data recovery; ezAvailability for real-time data replication with minimal recovery objectives; and ezMirror for data mirroring at the storage level.