Innodata Story

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INOD -- USA Stock  

USD 5.31  0.06  1.12%

83% of stocks are less volatile than Innodata, and 70% of all traded equity instruments are projected to make higher returns than the company over the 60 days investment horizon. Although many risk-takers are getting more into technology space, some of us are not very happy with Innodata's current volatility. What exactly are Innodata shareholders getting in December?
Published over three weeks ago
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Should you exit Innodata (NASDAQ:INOD) after the latest volatility surge?
Innodata currently holds roughly 13.48 M in cash with 4.92 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.55. Innodata holds a performance score of 12 on a scale of zero to a hundred. The company retains a Market Volatility (i.e. Beta) of 0.7284, which attests to possible diversification benefits within a given portfolio. Let's try to break down what Innodata's beta means in this case. As returns on the market increase, Innodata returns are expected to increase less than the market. However, during the bear market, the loss on holding Innodata will be expected to be smaller as well. Although it is essential to pay attention to Innodata current price history, it is also good to be reasonable about what you can do with equity current price movements. Our philosophy towards determining future performance of any stock is to look not only at its past charts but also at the business as a whole, including all fundamental and technical indicators. To evaluate if Innodata expected return of 1.68 will be sustainable into the future, we have found twenty-eight different technical indicators, which can help you to check if the expected returns are sustainable. Use Innodata sortino ratio, skewness, price action indicator, as well as the relationship between the potential upside and rate of daily change to analyze future returns on Innodata.
Volatility is a rate at which the price of Innodata or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Innodata may increase or decrease. In other words, similar to Innodata's beta indicator, it measures the risk of Innodata and helps estimate the fluctuations that may happen in a short period of time. So if prices of Innodata fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our technical analysis page.

How important is Innodata's Liquidity

Innodata financial leverage refers to using borrowed capital as a funding source to finance Innodata ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Innodata financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Innodata's total debt and its cash.

How Innodata utilizes its cash?

To perform a cash flow analysis of Innodata, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Innodata is receiving and how much cash it distributes out in a given period. The Innodata cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Innodata Net Cash Flow from Operations is projected to decrease significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at 4.85 Million

Innodata Volatility Drivers

Innodata unsystematic risk is unique to Innodata and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Innodata you can also buy Genpact Limited. You can also mitigate this risk by investing in the information technology services sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Innodata important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Innodata income statement and balance sheet. Here are more details about Innodata volatility.
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