This Overlooked AI Stock Could Outperform Nvidia in 2026, According to Analysts

Nvidia remains the dominant AI infrastructure play—its shares have rallied roughly 1,240% over five years as data-center GPU demand surged, and Wall Street projects revenue and EPS to grow at a 41% CAGR from fiscal 2025–2028, supporting a 12-month target of $237.94 (about +31%) and a current multiple near 28x next-year earnings. By contrast, smaller data-prep specialist Innodata, which counts at least five Magnificent Seven firms as clients and addresses the costly data-cleaning step that can consume ~80% of AI projects, has delivered nearly 1,400% gains over five years and analysts forecast roughly 68% upside to $93.75 as revenue is expected to rise ~46% to $249m in 2025 and adjusted EBITDA to $53m; management sees continued “transformative” growth into 2026. At an enterprise value of ~$1.8bn (about 33x this year’s adjusted EBITDA), Innodata could see its EV rise 22–67% depending on multiples, so while it could outperform Nvidia in the next 12–24 months due to higher growth and leverage, the two firms play complementary roles in the AI ecosystem and a combined exposure may be prudent.

Analysis

Nvidia has been the dominant AI-infrastructure beneficiary, with shares up roughly 1,240% over five years as data-center GPU demand surged; analysts project revenue and EPS to grow at a 41% CAGR from fiscal 2025 to 2028, the stock trades at about 28x next-year earnings and carries a Wall Street 12-month target of $237.94 (roughly +31%).

Innodata is a much smaller, high-growth niche play that prepares data for AI: revenue grew at a 25% CAGR from $56m in 2019 to $171m in 2024 and adjusted EBITDA rose from $3m to $35m over the same period; analysts expect revenue to increase ~46% to $249m in 2025 and adjusted EBITDA to rise 53% to $53m, with management guiding to continued “transformative growth” in 2026 and at least five Magnificent Seven customers already using its services.

At an enterprise value of ~$1.8bn (about 33x this year’s adjusted EBITDA), Innodata’s valuation requires continued execution and multiple expansion to meet the ~68% upside to the $93.75 consensus target; maintaining the same EV/EBITDA would imply ~22% EV growth, while a 45x multiple implies ~67% EV upside. Given the distinct roles each company plays in the AI stack and Innodata’s dependence on scale and margin improvement, the more risk-tolerant case favors Innodata for higher near-term upside while Nvidia offers larger-cap, infrastructure exposure priced for strong growth.

Key Decisions for Investors

• Maintain or establish core exposure to Nvidia for large-cap AI-infrastructure participation but size positions acknowledging a 28x next-year EPS multiple and roughly 31% consensus upside
• Take a tactical, smaller-weight position in Innodata to capture higher-growth upside while limiting exposure to small-cap execution and multiple-expansion risk
• Monitor Innodata’s 2025 revenue and adjusted EBITDA relative to the 46% and 53% forecasts and customer concentration among the Magnificent Seven as primary catalysts to add or trim the position
• Consider pairing allocations to both names to gain complementary exposure across the AI stack rather than making a binary bet on one stock outperforming the other