Innodata Inc. (INOD)
Valuation Overview•Is Innodata Inc. Overvalued or Undervalued?
Priced at a premium to peer multiples and intrinsic cash flows, demanding strong execution to justify current levels.
High-quality fundamentals with a strong composite quality score of 82/100, backed by robust profitability and solvency.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Elite compounder with fortress-level fundamentals across every core pillar.
Wall Street is highly bullish, projecting significant upside. The company currently dilutes shareholders to fund operations and growth rather than returning capital.
INOD exhibits elite business quality, driven by exceptional capital efficiency and highly lucrative margins (highlighted by a massive 119.7% ROIC). This is backed by a fortress balance sheet, holding significant net cash ($78M) and minimal debt risk.
The company is driving exceptional top-line expansion (47.1% 3Y CAGR) paired with stable bottom-line earnings. The company maintains healthy operational efficiency with a 16.6% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $90.1M | +47.6% | +47.1% | +34.0% | +15.7% | |
| EBITDA | $18.4M | — | — | — | — | |
| Net Income | $14.9M | +12.3% | — | — | — | |
| EPS (Diluted) | $0.42 | +3.4% | — | +107.2% | — | |
| Free Cash Flow | $34.8M | +30.7% | — | +53.0% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 40.9% | 38.6% | 37.7% | 33.9% |
| Operating Margin | 16.6% | 10.4% | 3.2% | 0.9% |
| Net Margin | 13.9% | 9.5% | 2.2% | -0.9% |
| FCF Margin | 21.9% | 10.2% | 4.4% | 2.4% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.13 | $0.42 | +223.1% | ||
| Q1'26 | $0.21 | $0.25 | +19.0% | ||
| Q4'25 | $0.14 | $0.24 | +71.4% | ||
| Q3'25 | $0.11 | $0.20 | +81.8% | ||
| Q2'25 | $0.17 | $0.22 | +29.4% | ||
| Q1'25 | $0.11 | $0.31 | +181.8% | ||
| Q4'24 | $0.07 | $0.35 | +400.0% | ||
| Q3'24 | $-0.00 | $-0.00 | — |
Total return is +106.1% (1Y), outperforming the benchmark by +81.1%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +80.2% | +70.9% | — |
| 1Y | +106.1% | +81.1% | — |
| 3YCAGR | +98.7% | +83.9% | — |
| 5YCAGR | +67.1% | +55.8% | — |
| 10YCAGR | +44.6% | +32.2% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Innodata Inc. (INOD) valuation, health, and returns.
Innodata Inc. is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Expensive versus peers compared to industry peers. overvalued (implying -88.7% downside from DCF intrinsic value of $10.78)
Innodata Inc. has multiple valuation anchors: DCF Intrinsic Value: $10.78 | Peer Relative Fair Value: $20.25 | Wall Street Analyst Target: $120.00 (implying +25.7% upside). A convergence of these signals offers higher conviction.
Innodata Inc. displays excellent financial health with a composite quality score of 82/100, supported by a Altman Z-Score of 33.8 (safe zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 119.7%.
Innodata Inc. does not return material capital to shareholders via dividends or share repurchases, electing to retain earnings to fund internal growth.
Innodata Inc.'s current growth trajectory is Stable. The company achieved +47.6% 1Y revenue growth and +3.4% 1Y EPS growth, compared to its 3Y revenue CAGR of +47.1%.
Wall Street consensus is Buy based on 6 analysts, beating EPS expectations in 88% of recent quarters with a 7-quarter streak. The consensus price target represents a +25.7% change from current levels.
Investment risks for Innodata Inc. include: -63.0% 1-year max drawdown, high beta (3.55x market volatility). Volatility risk is characterized by a beta of 3.55x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.