NEW YORK (TheStreet) -- Paul Lidskey, CEO of Datalink (DTLK) , acknowledged that his stock has had a rocky ride in 2014. Despite shares climbing 19% year to date, the stock has endured major swings. But that's mainly due to volatility in the corporate IT spending budget. 

Hopefully corporate IT spending smooths out a bit in 2015, he said, so that Datalink stock and others in the same industry can see a more consistent flow of revenue. 

Within that IT space, Lidskey said his company is focused on helping customers move away from hardware and transforming "IT operations into service organizations." In other words, Datalink is focused on helping its customers participate in cloud computing and improving their data center efficiency. 

Some companies want to take advantage of the cloud, but don't want to be exposed to public servers and potential security breaches. For that reason, Datalink can set up a private cloud network, Lidskey added. 


Datalink DTLK data by YCharts

Image placeholder title

TheStreet's Gregg Greenberg asked about the company's storage business, which has seen declining margins in recent years. 

"Margins have been declining," Lidskey acknowledged, but that's just part of the business. Companies in the storage business need to recognize this trend and address it, rather than ignore it.

For Datalink's part, the company is focused on selling its customers additional services. The services tend to have higher gross margins, he explained, which will help offset some of the margin compression from the storage business. 

And while organic growth is always nice, sometimes an acquisition can speed up the process. Lidskey said the company generally makes one acquisition every 12 to 18 months and that trend is likely to continue. 

Most recently, Datalink acquired Bear Data Solutions. The company brings a lot of exposure and customers in from the West Coast and actually decreases Datalink's risk of attempting to penetrate that market on its own, he concluded. 

-- Written by Bret Kenwell

Follow @BretKenwell

TheStreet Ratings team rates DATALINK CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate DATALINK CORP (DTLK) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels, good cash flow from operations and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins."

You can view the full analysis from the report here: DTLK Ratings Report