Critical Comparison: ZKH Group (NYSE:ZKH) versus Data Storage (NASDAQ:DTST)

Data Storage (NASDAQ:DTST) and ZKH Group (NYSE:ZKH) are both small-cap computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, risk and profitability.

Analyst Ratings

This is a summary of recent recommendations for Data Storage and ZKH Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Data Storage	0	2	0	0	2.00
ZKH Group	1	0	0	0	1.00

Valuation and Earnings

This table compares Data Storage and ZKH Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Data Storage	$1.38 million	5.66	$19.20 million	($0.33)	-10.12
ZKH Group	$1.29 billion	0.29	-$19.44 million	($0.08)	-36.50

Data Storage has higher earnings, but lower revenue than ZKH Group. ZKH Group is trading at a lower price-to-earnings ratio than Data Storage, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

11.6% of Data Storage shares are owned by institutional investors. Comparatively, 9.5% of ZKH Group shares are owned by institutional investors. 43.8% of Data Storage shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Data Storage has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, ZKH Group has a beta of 0.55, meaning that its share price is 45% less volatile than the S&P 500.

Profitability

This table compares Data Storage and ZKH Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Data Storage	N/A	-3.76%	-3.32%
ZKH Group	-0.90%	-2.80%	-1.30%

Summary

Data Storage beats ZKH Group on 8 of the 12 factors compared between the two stocks.

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. In addition, it offers cloud hosted production systems comprising ezHost, which delivers managed cloud services; and voice and data solutions, including Nexxis, which specializes in voice over internet protocol, internet access, and data transport solutions, which comprise dedicated internet services, SD-WAN options, and a cloud-based PBX solution. The company offers its solutions and services to businesses in healthcare, banking and finance, distribution services, manufacturing, construction, education, and government industries. Data Storage Corporation was founded in 2001 and is headquartered in Melville, New York.

About ZKH Group

ZKH Group Limited develops and operates a maintenance, repair, and operating (MRO) products trading and service platform that offers spare parts, chemicals, manufacturing parts, general consumables, and office supplies in the People’s Republic of China. The company provides MRO procurement and management services; digitalized MRO procurement solutions; and logistics and warehousing services. It also engages in the production and sale of intelligent warehousing equipment. ZKH Group Limited was founded in 1998 and is based in Shanghai, the People’s Republic of China.