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Innodata (INOD) Surges 19.2%: Is This an Indication of Further Gains?

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Innodata Inc. (INOD - Free Report) shares ended the last trading session 19.2% higher at $20.17. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 11.7% gain over the past four weeks.

Innodata is benefiting from  strong momentum in generative AI solutions and partnerships with major tech companies to develop large language models (LLMs).

This company is expected to post break-even quarterly earnings per share in its upcoming report, which represents a year-over-year change of +100%. Revenues are expected to be $27.57 million, up 40.2% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Innodata, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on INOD going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Innodata is part of the Zacks Computer - Services industry. PDF Solutions (PDFS - Free Report) , another stock in the same industry, closed the last trading session 2.3% higher at $38.46. PDFS has returned 11.8% in the past month.

PDF Solutions' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.15. Compared to the company's year-ago EPS, this represents a change of -21.1%. PDF Solutions currently boasts a Zacks Rank of #4 (Sell).


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