Investors have been piling into Nvidia shares over the past year, seeing the chip giant as the best AI play. While this may be true, there are obviously other good opportunities for AI out there. And who has decided to point it out to investors? Well, Nvidia has.
In case: SoundHound AI (NASDAQ: SOUN ). The voice recognition specialist saw its stock jump 67 percent in a single session last week, boosted by news of Nvidia’s investment. According to a recent 13-F filing, Nvidia owned about 1.7 million shares of Soundhound, worth about $3.7 million at the end of 2023.
HC Wainwright analyst Scott Buck said, “It’s not the big money, but AI King’s endorsement that got investors excited, and that’s a good thing.”
“While a relatively small investment, with approximately 246.9M SOUN shares outstanding, we believe this investment validates much of the work SoundHound has accomplished to date and is well on its way to becoming a leader in the AI space. gives additional credibility to the company’s growth strategy,” the analyst opined. will proceed and possibly reclassify assessment levels.”
The company is scheduled to report Q4 earnings on February 29, and it could offer another catalyst. Additional evidence that the company is on track to reach break-even, with an update on the recent definitive acquisition of SYNQ3 Restaurant Solutions, and potential revenue guidance for 2024, has investors Can further boost confidence and support recent gains.
Considering “meaningful growth opportunities” and expecting the margin profile to improve over time, Buck believes that even after the big gains, the value of the shares “remains attractive.”
“We recommend investors take a position in SOUN shares ahead of more positive operating results and favorable news flows driven by secular growth within the AI sector,” the analyst added.
Overall, Buck maintains a Buy rating on the stock, backed by a $5 price target, implying that the shares will see another 25% growth over the next year. (To view Buck’s track record, click here)
Only 2 other analysts have recently interacted with SOUN’s ratings, but like Buck, they are also positive, making the consensus view here a strong buy. From an average price target of $4.67, a year from now, shares will change hands for a 17% premium. (See Sound Houndstock Forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.