Datasea Inc. (NASDAQ: DTSS)

Sector: Technology Industry: Software - Infrastructure CIK: 0001631282
Market Cap 8.18 Mn
P/B 2.35
P/E -3.00
P/S 0.14
ROIC (Qtr) -38.62
Div Yield % 0.00
Rev 1y % (Qtr) -36.47
Total Debt (Qtr) 4.00 Mn
Debt/Equity (Qtr) 1.15
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About

Datasea Inc., a technology company based in Nevada, USA, with operations in Delaware, USA, and China, is a leading player in the field of intelligent acoustics and 5G messaging. The company's primary business activities include the development and sale of products and services related to ultrasound, infrasound, directional sound, and Schumann resonance, as well as 5G messaging. Datasea generates revenue through the sale of its products and services, with the Chinese market being its primary source of income. The company's main offerings include...

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Investment thesis

Bull case

  • Robust free cash flow of 752672 exceeds capital expenditure of 1214 by 619.99x, indicating strong organic growth funding capability.
  • Tangible assets of 3.34M provide exceptional 37.13x coverage of deferred revenue 90082, showing strong service capability backing.
  • Operating cash flow of 753886 provides strong 8.37x coverage of deferred revenue 90082, indicating service delivery capability.
  • Operating cash flow of 753886 provides strong 4.98x coverage of inventory 151513, indicating efficient inventory management.
  • Tangible assets of 3.34M provide robust 4.37x coverage of other current liabilities 766012, indicating strong asset backing.

Bear case

  • Operating cash flow of 753886 barely covers its investment activities of (2.96M), with a coverage ratio of -0.25, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (2.96M) provide weak support for R&D spending of 1.98M, which is -1.49x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • High receivables of 1.29M relative to inventory of 151513 (8.50 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • The company's operating cash flow of 753886 shows concerning coverage of stock compensation expenses of 2.55M, with a 0.30 ratio indicating potential earnings quality issues.
  • Operating earnings of (2.72M) show weak coverage of depreciation charges of 2M, with a -1.36 ratio indicating high capital intensity and potential reinvestment needs.

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Software - Infrastructure
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 MSFT Microsoft Corp 2,948.93 Bn 24.73 9.65 57.61 Bn
2 ORCL Oracle Corp 734.55 Bn 67.24 19.76 124.39 Bn
3 PLTR Palantir Technologies Inc. 313.28 Bn 192.78 70.00 0.23 Bn
4 PANW Palo Alto Networks Inc 109.38 Bn 97.90 11.45 0.35 Bn
5 CRWD CrowdStrike Holdings, Inc. 102.48 Bn -326.20 22.45 0.82 Bn
6 SNPS Synopsys Inc 69.14 Bn 51.90 9.80 14.29 Bn
7 NET Cloudflare, Inc. 66.52 Bn -645.60 33.04 3.50 Bn
8 FTNT Fortinet, Inc. 62.73 Bn 33.48 9.57 1.00 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.26 2.10
EV to Cash from Ops. EV/CFO 14.42 3.92
EV to Debt EV to Debt 2.72 -2.43
EV to EBIT EV/EBIT -4.00 11.57
EV to EBITDA EV/EBITDA -15.84 18.19
EV to Free Cash Flow [EV/FCF] EV/FCF 14.44 19.98
EV to Market Cap EV to Market Cap 1.33 1.27
EV to Revenue EV/Rev 0.19 29.29
Price to Book Value [P/B] P/B 2.35 4.97
Price to Earnings [P/E] P/E -3.00 -12.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.21
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 2.73
Dividend per Basic Share Div per Share (Qtr) 0.00 0.11
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.67
Interest Coverage Int. cover (Qtr) 0.00 -16.04
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 88.37 -403.22
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 150.57 223.80
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.28
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 78.39 585.97
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 94.28 5.89
EBIT Growth (1y) % EBIT 1y % (Qtr) 78.44 27.96
EBT Growth (1y) % EBT 1y % (Qtr) 78.44 20.61
EPS Growth (1y) % EPS 1y % (Qtr) 92.67 144.77
FCF Growth (1y) % FCF 1y % (Qtr) 131.84 50.30
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 359.82 45.98
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 6.58 0.65
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.13 1.23
Current Ratio Curr Ratio (Qtr) 0.60 2.63
Debt to Equity Ratio Debt/Equity (Qtr) 1.15 0.73
Interest Cover Ratio Int Coverage (Qtr) 0.00 -16.04
Times Interest Earned Times Interest Earned (Qtr) 0.00 -16.04
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -1.30 -549.97
EBIT Margin % EBIT Margin % (Qtr) -4.78 -240.33
EBT Margin % EBT Margin % (Qtr) -4.78 -608.68
Gross Margin % Gross Margin % (Qtr) 7.40 51.14
Net Profit Margin % Net Margin % (Qtr) -4.80 -611.28