As the internet and the digital world continue driving economic growth, many industries will prosper. For example, cloud technology has seen massive growth in the past decade and could keep growing at a 21% compound annual growth rate (CAGR) into 2030. However, not all growing companies in the sector receive the same attention, leading to some undervalued cloud stocks to keep an eye on.

Typically, cloud technology companies provide computing resources or online data storage services to consumers. Especially now that artificial intelligence is rapidly advancing, large-scale customers are increasingly in need of cloud services to support their artificial intelligence (AI) data centers and infrastructure. But, beyond just enterprises, even the average consumer relies on the cloud as a storage system external for personal devices. Thus, it can be easy to see why this industry is so important going forward and will continue to attract plenty of demand.

As investors, we want to maximize returns. That means picking and investing in companies that are sitting at just the right valuation to buy at. In this article, we will highlight three such undervalued cloud stocks that are a worthy addition to any portfolio.

Source: solarseven/Shutterstock

Data Storage Corporation (NASDAQ:DTST) is a company that works to provide cloud storage solutions to businesses, primarily for the protection and storage of data. While the stock gained over 200% in the past year, it still has more room to run. Yahoo Finance analysts have an average one-year price target of $9.00, well above the current price of $6.27.

Even though this company is small, it is making big moves in some interesting growth avenues. For example, DTST recently announced that its CloudFirst Solutions won the business of one of the largest insurance companies in the U.S. to help store its data with its cloud services.As management guides, this development will be integral in helping DTST continue having a steady stream of recurring, high-margin revenue.

Taking a look at the companys valuation, we can see that its EV/Sales ratio of 1.38x sits far below the sector median of 3.12x. Thus, when compared to its peers, the stock appears among relatively undervalued cloud stocks. With EPS expected to also grow over 200% year-over-year, Data Storage offers a cheap, cloud growth play to investors at a more than fair price.

Source: Shutterstock

NICE (NASDAQ:NICE) is a cloud-based AI software company that is a global leader in both customer engagement and financial crime & compliance end markets. While this Israeli-based company may be more unfamiliar to U.S. investors, Yahoo Finance analysts currently sit with a bullish one-year price target between an average of $283.71 to a high of $339.

For NICE, growth comes from its innovative way of combining cloud and AI technology to boost its product offering and financials. More recently, customer experience (CX) remains a key growth driver as Chatbots work to improve their user experience. In fact, Mordor Intelligence expects more than a doubling in the CX markets valuation from $19 billion in 2024 to $43 billion in 2025! Given that NICEs customer experience platform CXone is regarded as one of the best in its industry, theres no doubt that NICE will be able to grab a lions share of this CX market growth.

While this company is up more than 400% in the past decade, its stock is currently seeing a pullback. Furthermore, when taking a look at its P/E ratio of 18.3x, we see that it trades at a nearly 50% discount compared to its 5-year average. For a company with such a strong history and future growth plans, it would be foolish not to pick up a few shares before it rebounds.

Source: Jonathan Weiss / Shutterstock.com

Oracle (NYSE:ORCL) is a well-known IT company that has recently seen tremendous growth in its Cloud and AI business. In particular, its advancement in databases for Large Language Models has sparked optimism in many investors as a safe tech play during the current market turbulence. Wall Street analysts currently forecast a one-year price target between an average of $140.34 and a high of $160.

While Oracle has always been a strong contender in the AI cloud database market. its recent partnership with Palantir Technologies(NYSE:PLTR) is set to help both companies accelerate their offerings to enterprises. Some key synergies include PLTRs Foundry workload transition to Oracles cloud infrastructure, as well as the deployment of Oracles generative AI applications to complement Palantirs Gotham AI platform.

These high-growth prospects benefit even further from Oracles relatively attractive multiples. When looking at Oracles forward P/E ratio of 21.5x, we notice that its a solid 10% under its sector median. With so many recent AI tech stocks inflated to crazy multiples and prices currently, Oracle stands as an undervalued cloud company offering just as much growth potential at a much cheaper price point.

On the date of publication, Ian Hartana and Vayun Chugh did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chandler Capital is the work of Ian Hartana and Vayun Chugh. Ian Hartana and Vayun Chugh are both self-taught investors whose work has been featured in Seeking Alpha. Their research primarily revolves around GARP stocks with a long-term investment perspective encompassing diverse sectors such as technology, energy, and healthcare.

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The 3 Most Undervalued Cloud Stocks to Buy in June 2024 - InvestorPlace

NEW YORK, June 5, 2024 /PRNewswire/ -- The globalstand alone cloud storage marketsize is estimated to grow by USD 97.40billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of 30.08% during the forecast period.

For comprehensive forecast and historic data on regions, market segments, customer landscape, and companies- Click for the snapshot of this report

Forecast period

2024-2028

Base Year

2023

Historic Data

2018 - 2022

Segment Covered

End-user (Large enterprises and SMEs), Type (Public, Private, and Hybrid), and Geography (North America, APAC, Europe, South America, and Middle East and Africa)

Region Covered

North America, APAC, Europe, South America, and Middle East and Africa

Key companies profiled

Alphabet Inc., Amazon.com Inc., AT and T Inc., Atos SE, Cloudian Inc., Cognizant Technology Solutions Corp., Dell Technologies Inc., Egnyte Inc., Fidelity National Information Services Inc., Fujitsu Ltd., Hewlett Packard Enterprise Co., International Business Machines Corp., Iron Mountain Inc., Lumen Technologies Inc, Microsoft Corp., Navisite LLC, Quantum Corp., Rackspace Technology Inc., Samsung Electronics Co. Ltd., and Unitied Internet AG

Key Market Trends Fueling Growth

Hybrid stand-alone cloud storage systems offer organizations the ability to manage data effectively by combining the benefits of in-house and public cloud storage. These systems provide improved data management, enhanced IT infrastructure flexibility, and better security and compliance.

As businesses continue to adopt cloud computing, hybrid systems will become increasingly popular due to their cost-effectiveness and seamless workload transition capabilities. With a focus on modernizing applications and retaining business functionalities, the hybrid stand-alone cloud storage market is expected to experience significant growth during the forecast period.

The stand-alone cloud storage market is experiencing significant growth, with technologies like object storage and compression playing key roles. Companies are investing in secure, cost-effective solutions for data management. The use of advanced technologies such as artificial intelligence and machine learning is increasing, enabling automatic data classification and retrieval.

The demand for scalability and flexibility is driving the adoption of cloud storage solutions. Additionally, the trend towards remote work and digital transformation is accelerating the shift towards cloud-based storage systems. Overall, the market for stand-alone cloud storage is expected to continue growing, offering businesses innovative and efficient ways to manage their data.

MarketChallenges

The Stand Alone Cloud Storage Market faces restrictions due to data privacy regulations. These laws require financial firms to protect personal data and allow regulatory authorities access. However, the cloud model's inability to clearly identify and locate physical data storage hinders compliance with some regulations, such as the German Federal Data Protection Act. This limitation may hinder market growth during the forecast period.

The Stand Alone Cloud Storage market faces several challenges. Data security is a major concern, as companies need to ensure their information is protected from unauthorized access and cyber attacks. Cost is another challenge, as businesses must balance the need for affordable storage solutions with the requirement for high levels of security and reliability.

Scalability is also important, as companies need to be able to easily increase or decrease their storage capacity as their needs change. Additionally, interoperability between different cloud storage providers can be a challenge, making it difficult for businesses to seamlessly move data between systems. Finally, compliance with various regulations, such as HIPAA and GDPR, adds complexity to the use of cloud storage.

Research report provides comprehensive data on impact of trend, driver and challenges-Download a Sample Report

Segment Overview

1.1Large enterprises- The Stand Alone Cloud Storage market is experiencing significant growth due to increasing business demand for secure and flexible data management solutions. Companies are adopting stand-alone cloud storage systems to store and manage their data, enabling remote access and collaboration. This shift is driven by the need for scalability, cost savings, and enhanced security features. Businesses of all sizes are embracing stand-alone cloud storage as a strategic tool to streamline operations and improve overall efficiency.

For more information on market segmentation with geographical analysis including forecast (2024-2028) and historic data (2018 - 2022) - Download a Sample Report

Research Analysis

In the current economic climate, the stand-alone cloud storage market continues to experience robust adoption among business enterprises. This trend is driven by the proliferation of data generation and the need for secure, scalable, and seamless monitoring of data. Cloud storage offers convenience and customization, making it an attractive option for enterprise users seeking to reduce their CAPEX and OPEX compared to traditional on-premises storage. Cloud resources, including those from Alibaba Cloud and Microsoft, provide low-cost solutions for data storage, enabling revenue growth for businesses.

The cloud storage market also caters to the increasing demand for technology development in sectors such as gaming and entertainment, remote work, IoT, big data, and agile environments. Edge computing further enhances cloud storage capabilities, ensuring efficient and secure handling of malware and other cybersecurity threats. Overall, the stand-alone cloud storage market offers a cost-effective, flexible, and secure solution for managing and protecting data in today's digital landscape.

Market Research Overview

The Stand Alone Cloud Storage market refers to on-demand digital storage services provided over the internet without the need for local servers or personal computers. This technology offers numerous benefits such as scalability, accessibility, and cost-effectiveness. Companies and individuals can store and manage large volumes of data securely and retrieve it from anywhere at any time.

The market is witnessing significant growth due to the increasing adoption of digital transformation and the need for remote work solutions. Additionally, advancements in technology, such as artificial intelligence and machine learning, are driving innovation in the field, enabling more efficient and automated data management. The market is expected to continue expanding as more businesses and individuals recognize the benefits of cloud storage solutions.

Table of Contents:

1 Executive Summary 2 Market Landscape 3 Market Sizing 4 Historic Market Size 5 Five Forces Analysis 6 Market Segmentation

7Customer Landscape 8 Geographic Landscape 9 Drivers, Challenges, and Trends 10 Company Landscape 11 Company Analysis 12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

Contacts

Technavio Research Jesse Maida Media & Marketing Executive US: +1 844 364 1100 UK: +44 203 893 3200 Email:[emailprotected] Website:www.technavio.com/

SOURCE Technavio

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Stand Alone Cloud Storage Market size is set to grow by USD 97.40 billion from 2024-2028, Reduced capital and ... - PR Newswire

Rumors have been swirling that the Ticketmaster data breach reported last week was caused by compromise of a third party vendor, but there was initially no word of who it might have been. A hacker with the threat group ShinyHunters appears to have confirmed the attack to a security research firm and claims that cloud storage company Snowflake, which is used by numerous major corporations, is the source of the breach.

Snowflake says that it has performed a security review and found that the credentials of a demo account belonging to a former employee were recently used for unauthorized access by a threat actor, but that account did not have access to sensitive data or to the companys production or corporate systems. The company denies that it is the responsible party in the Ticketmaster data breach, and the security firm that posted the story has since removed it from its blog without explanation. But the Australian government has also since issued a direct warning to Snowflake customers that it has become aware of a successful compromise of several companies that use its environments.

A blog post from Israeli security firm Hudson Rock claimed that the company had been in contact with a hacker from ShinyHunters, who confirmed both the Ticketmaster data breach and a hack on Spains Santander Bank. ShinyHunters had already been openly offering the stolen data from these incidents for sale on BreachForums, the underground forum the group is a part owner-operator of, but the new element to the story was the claim that Ticketmaster was breached by way of Snowflake.

Snowflake caters to enterprise needs and has over 9,400 customers, which include Fortune 500 firms and some of the largest companies in the world. ShinyHunters claimed to have breached a number of these other companies as part of the action: Allstate, Anheuser-Busch, Progressive, Neiman Marcus and Mitsubishi among them. In total the threat actor claimed to have breached about 400 of Snowflakes customers.

The hackers were also forthcoming with technical details, claiming that the Ticketmaster data breach can be blamed on stolen credentials for a Snowflake employees ServiceNow account. The credentials were obtained by infecting the employee with Infostealer malware back in October. This access apparently allowed the attackers to generate valid session tokens providing them with further access to thousands of Snowflake clients. The hacker provided Hudson Rock with screenshots appearing to support this level of access to Snowflakes European servers.

ShinyHunters also claimed that they demanded a $20 million ransom from Snowflake for the Santander and Ticketmaster data breaches, but that the company would not communicate with them. The group is thought to have separately attempted to ransom Ticketmaster before putting the stolen data up for sale at a price of $500,000.

Snowflake has thus far acknowledged the breach of a former employees account, but has downplayed the damage and suggested that the stolen data is not legitimate. The fact that Hudson Rocks blog post disappeared without explanation over the weekend has made the story more hazy, but there are other strong indicators that Snowflake has been compromised and that the Ticketmaster data breach (and likely Santander and the others that were claimed) is related.

After the stolen information was posted for sale on the dark web, independent security research team VX-Underground claimed to have made contact with someone from ShinyHunters and confirmed that a third party vendor breach was the cause. The Australian Cyber Security Centre (ACSC) has since issued a warning of increased threat activity targeting Snowflake customers and advised them to take security precautions, and Mandiant Consulting CTO Charles Carmakal has told media sources that the company has been assisting unspecified Snowflake customers with breaches for several weeks now.

While the Ticketmaster data breach has yet to be formally acknowledged by the company, Santander has confirmed that it has been breached. This has left many in the cybersecurity community waiting for the other shoe to drop, so to speak, under the assumption this is another breach in the manner of the MOVEit incident about a year ago that will ultimately prove to have impacted many of Snowflakes downstream customers. ShinyHunters is seeking $20 million for the data stolen from Santander, which includes account and credit card numbers for tens of millions of customers in Spain, Chile and Uruguay as well as internal information about bank employees.

The original Hudson Rock post was archived by the Wayback Machine before being taken down. The company has yet to answer multiple media queries about why the post was removed. While Snowflake is still only admitting to limited damage at this time, it has issued a recommendation to clients to enforce MFA on all accounts and reset and rotate their credentials.

Brian Soby, CTO and co-founder at AppOmni, sees the Ticketmaster data breach and associated attacks as yet another incident that makes the case for zero trust architecture: The incident playing out at Snowflake is due to the same issue were seeing across the market: Companies are not incorporating the security of their SaaS applications into their security architectures Were seeing incident after incident due to companies implementing SSO or Zero Trust solutions like SSE/SASE, but not going far enough to secure the applications themselves. As demonstrated again today, these partial solutions not integrating SaaS Security Posture Management (SSPM) fail to stop a major source of modern data breaches. Incomplete solutions can be trivially bypassed in the vast majority of cases because of poor application security posture and do not allow organizations to leverage behavioral detections for their SaaS applications provided by an SSPM that would have quickly identified a login with stolen credentials.

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Hacker Claims That Snowflake Cloud Storage Was the Third Party Compromised in the Ticketmaster Data Breach - CPO Magazine

NetApps latest quarterly revenues swelled higher led by all-flash array demand.

Revenues rose for the third successive time to $1.67 billion in the fourth quarter of NetApps fiscal 2024, ended April 26, 2024, up 6 oercent and exceeding its guidance mid-point. There was a $291 million profit, up 18.8 percent annually, and NetApps 25th successive profitable quarter. This Kurian-led cash machine is so consistent. The all-flash array annual run rate (ARR) beat last quarters record to reach $3.6 billion, with $850 million AFA revenues in the quarter.

Full fy2024 revenues of $6.27 billion were 1 percent down Y/Y with profits of $986 million down 2.2 percent Y/Y.

Hybrid cloud revenues of $1.52 billion in the quarter rose 6.3 percent, basically driving the business. Cloud revenues, meaning public cloud, remain depressingly low at $152 million, a miniscule 0.7 percent higher Y/Y as the Anthony Lye-led buying spree still fails to deliver meaningful revenue increases.

CEO George Kurians results quote said: We concluded fiscal year 2024 on a high note, delivering company records for annual gross margin, operating margin, EPS, operating cash flow, and free cash flow and building positive momentum. In fiscal year 2025, we will remain laser focused on our top priorities of driving growth in all-flash and cloud storage services while maintaining our operational discipline.

NetApp probably has the best public cloud storage service offerings of all the storage suppliers, with its data fabric spanning the on-prem ONTAP world, and SW instantiations on AWS, Azure and GCP, and Blue XP hybrid cloud storage monitoring and management services. Yet significant demand has proved almost illusory and its competitors, notably, Dell, HPE and Pure are slowly but steadily catching up. Indeed Pure has a big announcement coming in this area next month.

Kurian pointed out NetApps public cloud progress in the earnings call, saying: In Q4, we had a good number of takeouts of competitors on-premises infrastructure with cloud storage services based on NetApp ONTAP technology, which helped drive our best quarter for cloud storage services with each of our hyperscaler partners. We are well ahead of the competition in cloud storage services and we are innovating to further extend our leadership position.

He referred to expected public cloud revenue growth, saying: We expect that cloud first-party and marketplace cloud storage should continue to ramp strongly, which will deliver overall growth in cloud, consistent revenue growth in cloud in fiscal year 25, stronger in the second half than in the first half.

Quarterly financial summary

NetApp widened the gap between its own all-flash array revenues and Pure Storage:

The AFA revenues were singled out by Kurian saying: Strong customer demand for our broad portfolio of modern all-flash arrays, particularly the C-series capacity flash and ASA block optimized flash, was again ahead of our expectations.

A look at NetApps quarterly revenue history shows that it reversed the lower Q1 and Q2 revenues this fiscal year with higher ones in Q3 and Q4 to end the year pretty much level pegging with the previous one:

Just like its competitors NetApp is seizing the AI opportunity in front of it, positioning itself as a provider of the data infrastructure foundation for enterprise AI.

Kurian said: Customers choose NetApp to support them at every phase of the AI lifecycle due to our high performance all-flash storage complemented by comprehensive data management capabilities that support requirements from data preparation, model training and tuning, retrieval-augmented generation or RAG, and inferencing, as well as requirements for responsible AI including model and data versioning, data governance and privacy. We continue to strengthen our position in enterprise AI, focusing on making it easier for customers to derive value from their AI investments.

He then said: We had about more than 50 AI wins in Q4 across all elements of the AI landscape I talked about, both in data foundations like data lakes as well as model training and inferencing across all of the geographies. I would tell you that in the AI market, the ramp on AI servers will be much ahead of storage because what clients our doing is theyre building new computing stacks but using their existing data. And so we expect that over time there will be a lot more data created and unified to continue to feed the model. But at this stage, we are in proof of concept. We think that theres a strong opportunity over time for us and all of the AI growth is factored into our guidance for next year.

He reckons that: AI is the opportunity that will become much more meaningful over time. We are well positioned with the huge installed base of unstructured data, which is the fuel for GenAI, and we are focused on helping customers do in-place RAG and inferencing of that data.

Next quarters revenue outlook is $1.455 to $1.605 billion, a $1.53 billion mid-point which would be a 7.0 percent annual rise. The full fiscal 2025 revenue outlook is $6.45 to $6.65 billion, with the $6.5 billion mid-point representing a 4.5 percent Y/Y increase and NetApps highest ever annual revenue.

This would end NetApps 11-year failure to beat its fy2013 $6.332 billion highpoint. George Kurian became CEO in 2015 and reaching a record revenue highpoint in fy2025, after 10 years in office would be quite a satisfying feat.

Wedbush analyst Maat Bryson told subscribers: Q1 and FY25 guidance both presented upside vs. prior Street expectations, while managements tendency towards conservatism, likely means that NTAP will eventually deliver results closer to the high end of the new forecast.

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All-flash leads NetApp revenues higher Blocks and Files - Blocks & Files