Innodata (INOD) AI Stock Analysis

• Market Cap: $2.44B
• Dividend Yield: N/A
• Average Volume (3M): 2.16M
• Price to Earnings (P/E): 61.6
• Beta (1Y): 3.53
• Revenue Growth: 112.54%
• EPS Growth: 1256.46%
• Country: US
• Employees: 6,597
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.20
• Shares Outstanding: 31,845,621
• 10 Day Avg. Volume: 1,882,041
• 30 Day Avg. Volume: 2,162,202
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.72
• Enterprise Value/Revenue: 7.68
• Enterprise Value/Gross Profit: 18.53
• Enterprise Value/Ebitda: 37.52
• 1Y Price Target: $91.67
• Price Target Upside: 15.54% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 77 Outperform
• Price Target: $49.00 ▼(-38.24% Downside)

Innodata's overall stock score of 77 reflects its strong financial performance and positive earnings call sentiment, which are the most significant factors. The company's robust revenue growth and strategic focus on AI and robotics position it well for future success. However, the high valuation and stock volatility slightly temper the score.

Positive Factors

Revenue Growth

The significant revenue growth demonstrates Innodata's expanding market reach and successful execution of its business strategy, positioning the company for continued success in the information technology sector.

Strategic Focus on AI

By focusing on AI and robotics, Innodata is aligning with industry trends, enhancing its competitive advantage, and opening new revenue streams, which could drive long-term growth and market leadership.

Strong Cash Position

A strong cash position provides Innodata with the financial flexibility to invest in growth opportunities, manage debt effectively, and navigate economic uncertainties, supporting sustainable business operations.

Negative Factors

Increased Operating Expenses

While strategic, increased operating expenses can pressure margins and reduce short-term profitability, necessitating careful management to ensure these investments yield expected returns.

Room for Operational Efficiency Improvement

Improving operational efficiency is crucial for enhancing profitability and competitiveness, as current margins indicate potential for better cost management and resource utilization.

Free Cash Flow Efficiency

Enhancing free cash flow efficiency is vital for sustaining long-term growth and investment capacity, as it indicates the ability to generate cash beyond operational needs and reinvest in strategic initiatives.

Innodata Business Overview & Revenue Model

Company Description

Innodata Inc. is a global provider of data management and digital transformation solutions, specializing in content and data services. The company operates primarily in the information technology sector, focusing on delivering innovative products and services that help organizations manage, process, and utilize large volumes of data effectively. Innodata's core offerings include content creation, data analytics, artificial intelligence, and machine learning solutions, catering to various industries such as publishing, financial services, and healthcare.

How the Company Makes Money

Innodata generates revenue through a multi-faceted business model that includes service contracts, project-based engagements, and subscription-based solutions. Key revenue streams consist of fees from consulting services, custom software development, and ongoing support for their data management platforms. The company also benefits from partnerships with technology firms and industry leaders, which enhance its service capabilities and market reach. Additionally, Innodata's focus on AI-driven solutions provides opportunities for recurring revenue through software licensing and maintenance fees, which contribute significantly to its overall earnings.

Innodata Financial Statement Overview

Summary

Innodata demonstrates strong financial health with significant revenue growth of 12.77% and a healthy net profit margin of 18.71%. The balance sheet shows low leverage with a debt-to-equity ratio of 0.15 and a high return on equity of 62.48%. Cash flow generation is robust, though there is potential to improve free cash flow efficiency.

Income Statement

Innodata's income statement shows strong revenue growth of 12.77% in the TTM period, indicating a positive trajectory. The company has a healthy net profit margin of 18.71% and a gross profit margin of 31.27%, reflecting efficient cost management. However, the EBIT margin of 13.56% and EBITDA margin of 15.61% suggest room for improvement in operational efficiency.

Balance Sheet

The balance sheet reflects a solid financial position with a low debt-to-equity ratio of 0.15, indicating low leverage. The return on equity is impressive at 62.48%, showcasing strong profitability. The equity ratio of 65.41% suggests a stable capital structure, though the company should monitor its debt levels to maintain financial flexibility.

Cash Flow

Cash flow analysis reveals a robust free cash flow growth rate of 18.80% in the TTM period, highlighting strong cash generation capabilities. The operating cash flow to net income ratio of 1.25 indicates efficient cash conversion. However, the free cash flow to net income ratio of 0.82 suggests that there is room to enhance free cash flow relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	228.14M	170.46M	86.78M	79.00M	69.75M	58.24M
Gross Profit	94.58M	67.07M	31.29M	27.47M	25.73M	19.89M
EBITDA	46.71M	30.13M	5.03M	-6.59M	1.22M	3.54M
Net Income	42.69M	28.66M	-908.00K	-12.01M	-1.80M	617.00K
Balance Sheet
Total Assets	132.62M	113.45M	59.43M	48.04M	59.22M	57.25M
Cash, Cash Equivalents and Short-Term Investments	59.79M	46.90M	13.82M	10.30M	18.90M	17.57M
Total Debt	4.22M	4.66M	5.48M	4.73M	6.31M	7.32M
Total Liabilities	45.98M	50.06M	34.44M	30.00M	32.81M	31.00M
Stockholders Equity	86.72M	63.47M	25.70M	18.77M	29.93M	29.64M
Cash Flow
Free Cash Flow	36.07M	27.27M	339.00K	-7.74M	783.00K	4.25M
Operating Cash Flow	43.80M	35.02M	5.90M	-1.22M	5.15M	5.66M
Investing Cash Flow	-7.73M	-7.74M	-5.07M	-7.03M	-4.37M	-1.38M
Financing Cash Flow	6.91M	6.06M	2.87M	-307.00K	773.00K	2.31M

Innodata Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 79.34
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INOD, the sentiment is Positive. The current price of 79.34 is below the 20-day moving average (MA) of 81.51, above the 50-day MA of 64.53, and above the 200-day MA of 48.32, indicating a neutral trend. The MACD of 2.35 indicates Positive momentum. The RSI at 54.96 is Neutral, neither overbought nor oversold. The STOCH value of 40.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INOD.

Innodata Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INOD	―	$2.44B	61.58	73.80%	―	112.54%	1256.46%
FORTY	―	$2.23B	28.78	11.46%	1.29%	9.16%	16.38%
GLOB	―	$2.63B	24.84	5.66%	―	8.66%	-35.78%
ASGN	―	$2.04B	15.58	7.25%	―	-4.86%	-25.15%
Sector *	―	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
AI	―	$2.46B	―	-40.94%	―	14.34%	-13.27%
BBAI	―	$3.08B	―	-222.48%	―	3.46%	-74.21%

Innodata Corporate Events

Innodata Isogen’s Earnings Call Highlights Robust Growth

Innodata Isogen’s recent earnings call conveyed a strong positive sentiment, marked by impressive revenue and EBITDA growth, alongside increased guidance and a promising pipeline of opportunities. Despite concerns over rising operating expenses and a higher future tax rate, the positive developments significantly overshadowed these challenges.

Innodata Inc. Reports Strong Q2 2025 Growth

Innodata Inc. is a global data engineering company that focuses on leveraging data and Artificial Intelligence (AI) to drive innovation for leading technology companies and enterprises. The company provides a range of solutions, platforms, and services for Generative AI builders and adopters, maintaining a legacy of delivering high-quality data and outcomes for over 35 years.