CS Disco Inc. Common Stock (LAW)

FairStock Score: 60/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a Buffett/Graham style investor, I start with business quality and the numbers. CS Disco provides cloud-native, AI-powered legal products for legal hold, eDiscovery, document review, and case management. That is a useful niche, but the financial record shows a company still searching for durable profitability. In fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $43.1M and net income was -$8.7M, or diluted EPS -$0.13. In fiscal Q2 2025, the quarter ended 2025-06-30, revenue was $38.1M and net income was -$10.8M. Sales are growing and losses are narrowing. For fiscal year 2025, ended 2025-12-31, revenue was $156.8M and net income -$44.4M. For fiscal year 2024, ended 2024-12-31, revenue was $144.8M and net income -$55.8M. For fiscal year 2023, ended 2023-12-31, revenue was $138.1M and net income -$42.1M. The company has not earned a profit in the supplied history, and the Lynch category is none because it lost money in each of the last four years. FairStock calculations at the 2026-10-13 close of $4.42 show a market cap of $286.9M, P/B 2.39, ROE -31.34%, ROCE -13.79%, negative trailing free cash flow of -$16.4M, and FCF yield -5.7%. Debt is low with D/E 0.05, but Altman Z-Score 1.91 and Piotroski F-Score 5/9 suggest caution. Revenue growth of 13.23% and profit growth of 19.92% are encouraging, but a negative P/E of -6.80 means there is no earnings-based valuation. I see a small, debt-light software business with a plausible legal workflow niche, but no proven moat or margin of safety yet. Graham would demand profits and asset protection; Buffett would ask for durable competitive advantage. Neither is clearly present.

In plain English: CS Disco sells cloud-based and AI-powered software that helps law firms and companies handle legal document requests, reviews, and case management. The business is growing sales, but it still loses money and has been burning cash. At the recent price of $4.42, the stock is not easy to call cheap because there are no profits to compare against, and it trades at a premium to its accounting value.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer