SoundHound AI is growing nicely but remains highly overvalued, with a price-to-sales ratio of 40x, far above the sector median of 3x. Despite expanding partnerships in automotive and restaurants, profitability remains a concern, with a $350M net loss in 2024 and aggressive shareholder dilution of 54.7%. Strong momentum and excitement around the AI sector have kept SOUN's valuation high. But, if the stock drops to a more reasonable 10x-15x P/S, it could be a better buying point.
Recently, Zacks.com users have been paying close attention to SoundHound AI (SOUN). This makes it worthwhile to examine what the stock has in store.
Nvidia (NVDA -0.14%) supplies the most powerful data center chips for developing artificial intelligence (AI) models. In fact, the company's valuation has soared by more than $2.2 trillion over the last two years because sales have been so strong.
Shares of SoundHound AI (SOUN 6.91%) climbed higher on Wednesday. The company's stock gained 6.9% as of market close but was up as much as 12.2% earlier in the day.
Many of the biggest companies in the world right now attained their gargantuan size due to their exposure to AI. From the developers of AI applications to the suppliers of critical AI components, nearly every company related to artificial intelligence saw its valuation soar in 2024.
When a management team predicts its revenue will double during its next fiscal year, investors should pay attention. This isn't a common occurrence, and it can reveal broader trends in the industry whenever a company predicts revenue will have a big jump.
SoundHound AI (NASDAQ: SOUN) stock has witnessed a roller-coaster ride on the stock market in the past year. It rose remarkably after it emerged that Nvidia had a small stake in the company, before witnessing periods of volatility for much of 2024 and then closing the year on a terrific note.
After a strong 2024 for SoundHound AI (SOUN -5.91%), it's been a rough start to 2025. However, the stock rallied from its recent lows following a strong fourth-quarter earnings report.
SoundHound AI (SOUN 4.48%) was having a terrible time on the stock market so far this year, but all that changed after the company released its fourth-quarter 2024 results on Feb. 27.
SoundHound AI (SOUN -1.49%) was one of 2024's top-performing stocks, rising 836%. However, 2025 hasn't been so kind, as the stock has fallen 45%.
Shares of SoundHound AI (SOUN -5.86%) have been on a wild ride over the past year. The provider of artificial intelligence (AI)-based voice tech saw its stock hit a 52-week low of $3.50 last April, but by December, shares soared to a high of $24.98.
SoundHound AI's recent selloff offers improved entry points for opportunistic investors, despite the high volatility from the elevated short interest volume and intensified insider selling. The company's robust growth, strategic acquisitions, and intensified R&D efforts position it for sustained high double-digits growth in the AI SaaS market. The same has been observed in SOUN's growing backlogs, raised FY2025 guidance, and promising consensus forward estimates through FY2026.