If Jim Cramer tells you to buy a stock, you might as well take out a second mortgage and short it into oblivion. If he tells you to sell, congrats… you’re about to miss out on generational wealth. I mean seriously, the man has to have the worst luck of anyone since the stock market was created in 1792.

We’ve seen it before… his infamous Bear Stearns call in 2008 (“No! No! No! Bear Stearns is not in trouble!”) was followed by one of the fastest financial implosions in history. His PayPal buy at $251 in 2021? Today, it’s trading at $71 (down more than 71%). And just last week, he declared Bitcoin a buy, only for it to implode 15% and erase $800 billion in market cap.

So when Cramer recently called Innodata Inc. a “hero stock,” you could practically hear shareholders across the world screaming in terror.

If you’re not familiar with Innodata, here’s the rundown… it’s a data engineering company that focuses on AI data preparation, transformation, and model deployment. In simple terms, they take raw, messy data and clean it up so that AI models can actually use it (sort of like an AI janitor). Companies building AI systems (whether for chatbots, image generation, or predictive analytics) need properly labeled and structured data, and that’s exactly what Innodata provides.

Their client list includes some of the biggest names in tech. Five out of the “Magnificent Seven” (Microsoft, Amazon, Google, Nvidia, Meta, Apple, and Tesla) rely on Innodata to refine massive datasets for their AI projects. Given that AI companies reportedly spend up to 80% of their time just cleaning and organizing data before they can even start training their models, outsourcing that work makes a lot of sense. It’s faster, cheaper, and lets the tech giants focus on more important things (like laying off employees while buying back their own stock).

And business has been booming. From 2023 to 2025, Innodata’s revenue has been growing at a 42% compound annual growth rate… a pace that’s hard to ignore. Even Jim Cramer had to give it props, saying, “What a stock. I mean, yeah, you were right. It's a high multiple stock and it didn't get hit today. How about that? That is what I call a hero stock.” (Yes, Jim, that’s how stocks work. They don’t collapse every single day.)

But while Cramer might have been bullish, he also issued a warning back in December 2024: “This is now a very expensive stock. And I just think if you take a little off the table, you can always get back in.” Turns out, some of Innodata’s insiders agreed.

On February 26, two key Innodata directors (Massey Stewart and Nauman Toor) dumped shares in a big way. Stewart sold $2.8 million worth, while Toor cashed out $12.67 million. Their trades happened while Innodata was trading at a P/E ratio of 92x, suggesting the stock was running hot.

Listen, Innodata is still a key AI player, with solid revenue growth and major tech clients. But at this valuation, you’d have to be running on sunshine and rainbows to buy it at this level.

Cramer’s warning about the stock being “very expensive” is rare in itself… he’s usually the last guy to call out an overheated stock. So, let’s give him props for now. This is a rare day.

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Stock.News has positions in Microsoft, Amazon, Google, Meta, Apple, and Tesla.