HireQuest (NASDAQ:HQI) vs. Innodata (NASDAQ:INOD) Critical Analysis

Innodata (NASDAQ:INOD) and HireQuest (NASDAQ:HQI) are both industrials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, earnings, analyst recommendations, risk and valuation.

Analyst Recommendations

This is a summary of current recommendations and price targets for Innodata and HireQuest, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innodata	0	2	1	1	2.75
HireQuest	0	1	2	0	2.67

Innodata presently has a consensus target price of $130.00, suggesting a potential upside of 97.69%. HireQuest has a consensus target price of $19.00, suggesting a potential downside of 0.68%. Given Innodata’s stronger consensus rating and higher probable upside, research analysts clearly believe Innodata is more favorable than HireQuest.

Risk & Volatility

Innodata has a beta of 2.88, indicating that its share price is 188% more volatile than the S&P 500. Comparatively, HireQuest has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500.

Insider & Institutional Ownership

30.7% of Innodata shares are held by institutional investors. Comparatively, 12.0% of HireQuest shares are held by institutional investors. 11.8% of Innodata shares are held by company insiders. Comparatively, 42.9% of HireQuest shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Innodata and HireQuest”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innodata	$251.66 million	8.98	$32.18 million	$1.32	49.82
HireQuest	$30.64 million	8.68	$6.33 million	$0.57	33.56

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Innodata	14.66%	37.79%	20.92%
HireQuest	27.06%	16.35%	12.11%

Summary

Innodata beats HireQuest 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 HireQuest

HireQuest, Inc. provides temporary staffing services in the United States. It offers staffing services, including direct-dispatch, executive search, consultant, unskilled and semi-skilled industrial and construction personnel, clerical and administrative personnel, and permanent placement services, as well as commercial and non-CDL drivers, and skilled personnel in the medical and dental industries. The company provides its services under the HireQuest Direct, HireQuest, SNelling, DriverQuest, HireQuest Health, Northbound Executive Search, and MRI trade names. It serves construction, recycling, warehousing, logistics, auctioneering, manufacturing, hospitality, landscaping, and retail industries, as well as dental practices. HireQuest, Inc. was founded in 2002 and is headquartered in Goose Creek, South Carolina.