Analyzing Adecco (OTCMKTS:AHEXY) & Innodata (NASDAQ:INOD)

Innodata (NASDAQ:INOD) and Adecco (OTCMKTS:AHEXY) are both mid-cap industrials companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Innodata and Adecco, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innodata	0	1	1	2	3.25
Adecco	2	2	2	1	2.29

Innodata currently has a consensus price target of $130.00, suggesting a potential upside of 107.23%. Given Innodata’s stronger consensus rating and higher probable upside, equities analysts plainly believe Innodata is more favorable than Adecco.

Volatility & Risk

Innodata has a beta of 2.92, meaning that its share price is 192% more volatile than the S&P 500. Comparatively, Adecco has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Insider and Institutional Ownership

30.7% of Innodata shares are owned by institutional investors. 11.8% of Innodata shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Innodata and Adecco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Innodata	13.86%	37.49%	23.65%
Adecco	1.31%	12.09%	3.42%

Earnings & Valuation

This table compares Innodata and Adecco”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innodata	$283.42 million	7.23	$32.18 million	$1.11	56.52
Adecco	$26.11 billion	0.18	$333.76 million	$1.05	13.22

Adecco has higher revenue and earnings than Innodata. Adecco is trading at a lower price-to-earnings ratio than Innodata, indicating that it is currently the more affordable of the two stocks.

Summary

Innodata beats Adecco on 12 of the 15 factors compared between the two stocks.

About Innodata

Innodata Inc. operates as a global data engineering company in the United States, the United Kingdom, the Netherlands, Canada, and internationally. The company operates through three segments: Digital Data Solutions (DDS), Synodex, and Agility. The DDS segment engages in the provision of artificial intelligence (AI) data preparation services; collecting or creating training data; annotating training data; and training AI algorithms for its customers, as well as AI model deployment and integration services. This segment also provides a range of data engineering support services, including data transformation, data curation, data hygiene, data consolidation, data extraction, data compliance, and master data management. The Synodex segment offers an industry platform that transforms medical records into useable digital data with its proprietary data models or client data models. The Agility segment provides an industry platform that offers marketing communications and public relations professionals to target and distribute content to journalists and social media influencers; and to monitor and analyze global news channels, such as print, web, radio, and TV, as well as social media channels. It serves banking, insurance, financial services, technology, digital retailing, and information/media sectors through its professional staff, senior management, and direct sales personnel. The company was formerly known as Innodata Isogen, Inc. and changed its name to Innodata Inc. in June 2012. Innodata Inc. was incorporated in 1988 and is headquartered in Ridgefield Park, New Jersey.

About Adecco

Adecco Group AG, together with its subsidiaries, provides human resource services to businesses and organizations in Europe, North America, Asia Pacific, South America, and North Africa. It offers flexible placement, permanent placement, outsourcing, training, upskilling and reskilling, career transition and workforce transformation, consulting, talent academy, digital staffing solutions under the Adecco, Akkodis, General Assembly, Badenoch + Clark, Lee Hecht Harrison, pontoon, Spring Professional, Adia, Modis, and YOSS brand names. The company also operates Hired, a talent recruitment platform. The company was formerly known as Adecco S.A. Adecco Group AG was founded in 1957 and is based in Zurich, Switzerland.