Reviewing Crexendo (NASDAQ:CXDO) and Data Storage (NASDAQ:DTST)

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

Risk & Volatility

Data Storage has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, Crexendo has a beta of 0.88, meaning that its stock price is 12% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Data Storage	-1.17%	-1.42%	-1.19%
Crexendo	4.75%	11.33%	9.14%

Insider & Institutional Ownership

11.6% of Data Storage shares are held by institutional investors. Comparatively, 9.5% of Crexendo shares are held by institutional investors. 43.8% of Data Storage shares are held by insiders. Comparatively, 47.2% of Crexendo shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Data Storage and Crexendo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Data Storage	2	1	0	0	1.33
Crexendo	0	1	5	0	2.83

Crexendo has a consensus target price of $9.08, suggesting a potential upside of 26.16%. Given Crexendo’s stronger consensus rating and higher possible upside, analysts plainly believe Crexendo is more favorable than Data Storage.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Data Storage	$25.37 million	1.18	$520,000.00	($0.04)	-103.50
Crexendo	$66.35 million	3.33	$1.68 million	$0.15	48.00

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

Summary

Crexendo beats Data Storage on 12 of the 14 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 Crexendo

Crexendo, Inc. provides cloud communication platform and services, video collaboration, and managed IT services for businesses in the United States and internationally. It operates through two segments, Cloud Telecommunications Services and Software Solutions. The Cloud Telecommunications segment provides telecommunications services that transmit calls using Internet protocol (IP) or cloud technology, which converts voice signals into digital data packets for transmission over the Internet or cloud; and broadband Internet services, as well as develops end user portals for account and license management, and billing and customer support. This segment is also involved in the sale and lease of cloud telecommunications equipment. In addition, it offers hardware, software, and unified communication solutions for businesses using IP or cloud technology over high-speed internet connection through various devices and user interfaces, such as desktop phones and/or mobile, and desktop applications under the Crexendo brand name. The Software Solutions segment provides a suite of unified communications, collaboration, video conferencing, and contact center solutions. This segment also offers SNAPsolution, an IP-based platform; SNAPaccel, a software-as-a-service based software; subscription maintenance and support services; and professional services, including consulting, technical support, resident engineer, design, and installation services. The company was formerly known as iMergent, Inc. and changed its name to Crexendo, Inc. in May 2011. Crexendo, Inc. was incorporated in 1995 and is based in Tempe, Arizona.