Although U.S. Congress and Senate members are known for their well-timed and mostly profitable stock trades, some exceptions prove the rule, as with Senator Thomas Carper’s trade on August 29, 2023.
Namely, the Senator from Delaware purchased up to $15,000 worth of Innodata (NASDAQ: INOD) stock on August 29, 2023, when its price was $15 per share.
Senator Carper’s purchase of INOD stock. Source: Quiver Quantitative
However, since then, INOD stock has experienced a 43% decline, falling to a valuation of $6.50 per share on March 21, 2024, when the Democrat Senator decided to offload his entire stake in Innodata for a loss of $8,500 on the trade, leaving him with $6,500 from his initial investment.
Senator Carper’s sale of INOD stock. Source: Quiver Quantitative
But what makes this trade even more ill-timed is that INOD stock has surged 165.85% since the sale.
INOD stock performance since Senator Carper’s sale on March 21. Source: Google Finance
What caused the INOD stock surge?
Although a lesser-known stock, INOD is strongly connected to generative artificial intelligence (AI) and has benefited from the rally this sector experienced in 2024.
Innodata specializes in data collection for AI models, allowing it to expand its capabilities further. This made this company one of the first to start building databases for AI models, even before they became popular and highly profitable.
In its latest Q2 report, released on August 24, the company announced impressive financial results, where revenue reached $32.6 million, marking a 66% increase year-over-year.
Additionally, it reported an adjusted EBITDA of $2.8 million, reflecting a 76% growth compared to the previous year.
Based on this solid performance, Innodata has raised its guidance, projecting revenue growth of 60% or more for 2024.
If Carper were just a little more patient and decided to hold the stock for an entire year, his investment would now appreciate $17,280, for a profit of $2,280, thanks to Innodata’s strong Q2 performance.
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