Innodata is rising rapidly in a first-stage cup base that has a buy point of 55.69. The artificial intelligence play reported strong profit growth in the recent four quarters. The AI stock is Tuesday's selection for IBD 50 Stocks To Watch.
INOD stock offers an earlier entry at 55.55, according to IBD MarketSurge pattern recognition tools.
Innodata runs a platform for developing data and training generative AI models.
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Second-quarter earnings of 20 cents per share compared with break-even earnings per share in the year-earlier quarter. Sales of $58.4 million grew 79%. The results surpassed Wall Street's projections.
Analysts expect Innodata to post earnings of 14 cents per share for the current quarter, or a 72% decline from a year ago. Sales estimates sit at $59.8 million, which would represent a 14% increase.
For the full year, analysts are eyeing earnings of 80 cents per share, or an 11% increase from 2024. In 2026, profit is seen rising 35% to $1.08 per share.
Innodata Named To Elite 30 Powering AI Revolution
Innodata said it was recently named by Wedbush as one of 30 leaders closely tied to the AI revolution. Analysts see AI investments by businesses exceeding $325 billion in 2025. The knowledge processing company stands to benefit from rising demand for "domain-specific, high-accuracy AI solutions," Innodata said, citing Wedbush.
Other companies on the elite-30 list include Nvidia, Alphabet, Microsoft, and Palantir.
Innodata shares are on track for a four-day winning streak on Tuesday. The early-stage base holds the promise of strong gains after a breakout. The relative strength line is rising as well, showing that the stock is gaining more than the benchmark S&P 500.
Innodata is in Investor's Business Daily's computer-tech services group. The group holds 64th place among IBD's 197 industry groups.
Its overall score, or Composite Rating, is high, at 91 out of 99. But the Relative Strength Rating of 93 also shows that the stock has been outperforming the majority of other stocks in the IBD database over the past 52 weeks.
Its Earnings Per Share Rating of 80 meets the recommended minimum level for growth stocks.
AI Stock: More Funds Load Up On Tech Leader
Innodata also enjoys significant institutional support. An increasing number of funds have bought the stock in the past six quarters.
Mutual funds own a total 29% of outstanding shares. Over the last 13 weeks, funds have been net buyers, giving the stock an Accumulation/Distribution Rating of B.
Innodata is also on the IBD Tech Leaders list.
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