Palisades Investment Partners, LLC disclosed a significant reduction in its Innodata (INOD 5.18%) stake, selling 361,144 shares for an estimated $18.24 million during Q3 2025, according to its October 30, 2025, SEC filing.
What happened
Palisades Investment Partners reported in a Securities and Exchange Commission (SEC) filing dated October 30, 2025, that it sold 361,144 shares of Innodata during Q3 2025.
The estimated value of this trade was $18.24 million, based on the average closing price for Q3 2025.
After the sale, the fund held 7,708 shares valued at $594,056 as of September 30, 2025.
What else to know
The transaction was a sizable reduction, bringing the Innodata stake to 0.23% of Palisades Investment Partners' reportable assets as of September 30, 2025.
Top holdings after the filing:
- Sterling Infrastructure: $32.54 million (12.8% of AUM) as of September 30, 2025
- SPX Technologies: $21.00 million (8.2% of AUM) as of September 30, 2025
- MakeMyTrip: $10.99 million (4.3% of AUM) as of September 30, 2025
- iShares Russell 2000 ETF: $9.78 million (3.8% of AUM) as of September 30, 2025
- Itron: $9.17 million (3.6% of AUM) as of September 30, 2025
As of October 29, 2025, Innodata shares were priced at $78.70, up 263% over the past year and outperforming the S&P 500 by 266 percentage points.
The position was previously 8.3% of the fund's AUM as of the prior quarter.
Company overview
| Metric | Value |
|---|---|
| Price (as of market close October 29, 2025) | $78.70 |
| Market Capitalization | $2.38 billion |
| Revenue (TTM) | $228.14 million |
| Net Income (TTM) | $42.69 million |
Company snapshot
Innodata:
- Offers AI-enabled data engineering platforms and managed services for data annotation, transformation, curation, and compliance, as well as specialized solutions for medical records digitization and media monitoring.
- Generates revenue through managed services, software platforms, and industry-specific platforms supporting AI/ML training, digital transformation, and data management.
- Serves enterprise clients in banking, insurance, financial services, technology, digital retail, and media sectors across North America and international markets.
Innodata is a technology company specializing in data engineering and AI-driven solutions, with operations spanning the United States and international markets.
The firm leverages proprietary platforms to deliver scalable data services and digital transformation capabilities, positioning itself as a key partner for organizations adopting artificial intelligence and advanced analytics.
Foolish take
Palisades Investment Partners all but liquidated their position in the burgeoning artificial intelligence (AI) growth stock Innodata last quarter. This sale was noteworthy as the stock was previously the firm's second-largest holding, equalling 8.2% of its portfolio.
Considering that Palisades opened a position in Innodata when it was trading for around $15 in 2024, selling the stock for roughly $70 just 18 months later is impressive.
That said, while selling your winners is an almost unavoidable event for institutional investing, I'd argue long-term, Foolish investors may want to let Innodata keep running if they already own it.
Growing sales by 79% in its last quarter and already counting five of the Magnificent Seven as customers, Innodata's recent run shouldn't scare investors away.
While it trades at a hefty 71 times free cash flow, Innodata's margins may not have yet peaked, and management believes sales will grow by 45% this year.
Positioned as a "picks and shovels" type of investment in the AI, generative AI, and large language model realms, Innodata should get more time to demonstrate its long-term potential, in my opinion.
Glossary
Assets Under Management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.
13F Reportable Assets: Securities holdings that institutional investment managers must disclose quarterly to the SEC using Form 13F.
Q3: The third quarter of a company's fiscal year, typically covering July through September.
Top Holdings: The largest investment positions in a fund's portfolio, usually ranked by market value.
TTM: The 12-month period ending with the most recent quarterly report.
Managed Services: Ongoing outsourced services provided to clients, often including operational support and technology management.
Data Annotation: The process of labeling or tagging data to make it usable for machine learning and AI applications.
Data Curation: The process of organizing, validating, and maintaining data to ensure its quality and usability.
Digital Transformation: The integration of digital technology into all areas of a business to improve operations and value delivery.
AI/ML Training: Preparing and processing data to develop and improve artificial intelligence and machine learning models.
Reportable Assets: Investments that must be disclosed to regulators, often referring to holdings included in official filings.
Proprietary Platforms: Custom-built software systems owned and used exclusively by a company to deliver its services or products.
