Is Innodata the Best-Performing Small-Cap Tech Stock in the Past Three Years?

Innodata Inc. (NASDAQ:INOD) is one of the best-performing small-cap tech stocks in the past three years. In our list of the high-performers, it had the highest 3-year CAGR of 157.7%

As of December 5, the company is a consensus Buy with all analysts covering it assigning a Buy rating. Despite a substantial pullback since the second week of October, the stock is still up over 46% year-to-date. After that strong run, the consensus 1-year median price target of $92.5 still reflects a potential upside of 60%.

Among the analysts who have recently published was BWS Financial analyst Hamed Khorsand, who reiterated a Buy rating on Innodata Inc. (NASDAQ:INOD) with a $110 price target on November 11.

Separately, on November 6, the company announced the launch of Innodata Federal, a dedicated business unit focused on delivering AI solutions to U.S. defense, intelligence, and civilian agencies. The new unit is designed to help federal customers move faster on AI adoption while staying within strict security and evolving procurement frameworks such as OTAs and CSOs.

Innodata Federal will lean on the company’s experience in AI data engineering, model training, generative AI, and agentic AI to support missions including imagery analysis, autonomous systems development, document intelligence, and open-source intelligence monitoring. The business has already begun generating revenue through partnerships with major defense technology companies and prime contractors, as well as its first direct award from a U.S. defense agency, giving Innodata an early foothold in the expanding federal AI market.

By combining commercial-grade AI platforms with a cleared U.S. STEM workforce and global delivery infrastructure, Innodata aims to present itself as a scaled, low-risk partner for large government programs.

Innodata Inc. (NASDAQ:INOD) is a New Jersey–based data engineering and AI services company that builds and operates AI and data solutions for leading global technology companies and large enterprises.

While we acknowledge the potential of INOD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.