SoundHound AI (SOUN) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.
At first, SoundHound AI looked like everything I hated -- voice response bots, a business likely to be crushed by giant rivals, and horrific financials. But my views changed as I dug deeper. It's voice-response platform is light years ahead of the junky chatbots I despise, and I'm a lot less scared of big-tech rivals. Just because a company says AI doesn't make it for real or useful. SOUN, however, is differentiating itself through bona fide use of AI principles.
SoundHound AI (SOUN -2.74%) was one of the best-performing stocks in 2024, rising 836%. At its peak, the stock was up a jaw-dropping 1,040% -- but that was last year.
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.