Innodata Inc. Common Stock (INOD)
Fast GrowerFairStock Score: 41/100 — MIXED
Key Financials
| Current Price | $96.1 |
| Market Cap | $1.4B |
| P/E Ratio | 85.8 |
| ROE | 38.6% |
| Dividend Yield | —% |
| Sector | Technology |
Strengths
- Generates $23 million in annual free cash flow (1.6% yield on market cap)
- High return on equity of 37.8% demonstrating efficient capital deployment
- Conservative balance sheet with debt-to-equity of just 0.04, providing financial flexibility
- Altman Z-Score of 15.7 confirms minimal bankruptcy risk and strong solvency
- Revenue growth of 22.3% demonstrates strong top-line momentum
Concerns
- Trades significantly above Graham Number ($8) with negative 432% margin of safety—limited downside protection
AI Analysis
Innodata Inc. Common Stock is a micro-cap technology company valued at $1.4 billion. The business generates $252 million in annual revenue with a 3.5% net margin and $23 million in free cash flow. From a quality standpoint, Innodata shows Altman Z-Score of 15.7 confirms fortress-level solvency and strong 38% ROE. On valuation, the stock is commanding a steep 47.3x multiple, with trades far above its Graham Number ($8) with no margin of safety. Growth dynamics show revenue growing at 22.3% and profit growth of -14.2%. Our composite FairStock Score of 41/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.
Bull Case
Innodata's 22% revenue growth trajectory could accelerate as it captures additional market share in the technology sector. With $23 million in annual free cash flow (1.6% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.
Bear Case
At 47x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.
Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer