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Innodata Inc. Message Board

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  • o08o.ugh64w o08o.ugh64w Feb 1, 2013 11:06 AM Flag

    What is the point...

    Ok, you've asked, so you shall receive.

    The basis for our own research stems from insider trading and then we extend it based on the fundamentals.

    INOD caught our attention a short while ago for the strong history of insider purchasing. Generally, we discount purchases by directors and apply a greater factor to purchases by officers. With INOD, we liked that senior management was purchasing fairly regularly. We did notice a few sales, but they were related to exercising options and we don't weigh those as heavily.

    Seeing the strong insider purchasing we looked at the financials/fundamentals.

    We like that there's no debt, about $1/share in cash on the balance sheet, and the company is profitable. With the stock at $3.84 right now, it's effectively valuing the business at $2.84/share, or about $70 million. Looking at trailing 12 months earnings of $9 million that's an effective P/E of 7.7, P/S of 0.77, and PEG shows an estimate of 0.39. These are all very strong numbers for a company in INOD's business.

    We also look at other things, but that's the bulk of what made us interested in INOD as a conservative investment with much more upside than downside.

2.41+0.04(+1.69%)Jul 22 3:21 PMEDT