Data Storage Corporation, a Nevada-based company specializing in computer processing and data preparation services, has announced that four of its top executives have arranged to sell company stock. The transactions are part of pre-arranged stock selling plans in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934 and the company's Insider Trading Policy.
On September 12, 2024, Charles Piluso, CEO; Chris Panagiotakos, CFO; Harold Schwartz, President; and Thomas Kempster, Executive Vice President, each entered into written stock selling plans, known as 10b5-1 Plans. These plans allow for the sale of company stock under predetermined conditions, ensuring that the executives are not trading on material non-public information.
The plans authorize the sale of approximately 8,967 shares by Piluso, 6,072 shares by Panagiotakos, 5,299 shares by Schwartz, and 5,299 shares by Kempster. The sales are scheduled over a seven-month period starting from September 12, 2024, and ending on April 15, 2025. The executives intend to use the proceeds from these sales to cover income tax obligations related to previous awards of restricted stock units under the company's 2021 Stock Incentive Plan.
As per the company's disclosure, transactions under these plans will be reported through Form 144 and Form 4 filings with the Securities and Exchange Commission. Data Storage Corporation has stated that, beyond legal requirements, it does not plan to provide regular reports on the 10b5-1 Plans of its officers or any changes to these plans.
In other recent news, Data Storage Corporation (DSC) has been making significant strides in its operations. The company recently secured a six-figure contract with a major music publisher, offering specialized cloud hosting services.
The contract was facilitated by DSC's subsidiary, CloudFirst, which will oversee the migration of the publisher's on-premises servers to a cloud environment.
On the financial front, DSC reported mixed results for Q2 of 2024. The company witnessed a decline in revenue, dropping to $4.9 million, largely due to one-time equipment sales in 2023. However, the gross profit margin saw an increase, rising to 49%. Despite a net loss of $244,000 for the quarter, DSC managed to remain profitable for the first half of 2024, with revenues totaling $13.1 million.
In terms of strategic developments, DSC has been focusing on international expansion, primarily in the UK, where it recently established a new office. The company is also preparing to deploy infrastructure in two UK data centers. These moves are part of DSC's broader plan to grow its recurring revenue streams, which includes increasing channel partnerships and hiring in key areas.
Analysts noted that the company's adjusted EBITDA for Q2 was down to $164,000 from $350,000 in the same period last year. Despite these challenges, DSC ended the quarter with $12 million in cash and marketable securities, and no long-term debt.
InvestingPro Insights
Investors monitoring the executive stock sales at Data Storage Corporation may find additional context in the company's recent financial performance and market valuation. According to InvestingPro data, Data Storage Corporation holds a market capitalization of $25.18 million, which reflects the market's current valuation of the company. Despite trading at a high earnings multiple with a P/E ratio of 109.22, analysts have a positive outlook, predicting that the company will be profitable this year. This optimism is further supported by a significant return of over 10% in the last week, indicating investor confidence may be on the rise.
Moreover, an InvestingPro Tip highlights that the company's liquid assets exceed its short-term obligations, which could suggest financial stability and the ability to cover immediate liabilities. This information could be particularly relevant for investors considering the implications of the executives' stock sales. For those seeking a deeper analysis, there are additional InvestingPro Tips available on the platform, offering a comprehensive view of Data Storage Corporation's financial health and market position.
Investors may also note that Data Storage Corporation does not pay a dividend, which could influence investment strategies focused on income generation. As the company navigates through its executive stock selling plans, these financial insights provide a broader picture of its market performance and potential future trajectory.
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