In 2024, The artificial intelligence (AI) industry With global AI funding reaching new heights, it continues to attract significant investment. Crunchbase reports that AI startups raise more than $50 billion globally in 2023.Despite a broader venture capital slowdown, this trend shows no signs of slowing down in the current year. Big tech companies like Nvidia ( NVDA ), Microsoft ( MSFT ), and Alphabet ( GOOGL ) are spending billions on AI research, acquisitions, and partnerships.
One such company, Soundhound AI, Inc. ( SOUN ), is making waves in the AI penny stock market through its advanced voice-enabled AI and conversational intelligence technologies. SOUN has already achieved a remarkable growth of 182% year-to-date, thanks to which Strategic investment from AI heavyweight Nvidia.
However, Soundhound AI stock retreated sharply after the company pushed back its profit target. While investors were clearly disappointed, at least one high-profile tech analyst sees a particularly bright future for this low-cost AI pick. Here’s a closer look at what Wall Street expects from this outperformance. Money stock now.
SOUN is deprived of earnings.
So, 2024 has been quite a year for SoundHound AI (SOUN). The stock was up 273% this year at a peak of $7.91 – but in late February, SOUN fell 18.5% in one session as investors reacted. Quarterly earnings are missed.
Although SoundHound AI reported an 80.5 percent increase in revenue to $17.15 million, the number fell well short of Wall Street’s estimate of $17.21 million. Similarly, loss per share of $0.07 was slightly wider than expected. Additionally, SOUN had previously forecast that it would achieve positive EBITDA in 4Q 2023, but – despite the improvement in margins – it has now This milestone has been pushed back. Sometime in 2025.
That said, these kinds of wild price swings are pretty standard not only in the penny stock world — but also in the AI stock universe, given Nvidia’s massive intraday volatility To finish last week. In any case, for those who were riding the buzz of Nvidia’s multi-million investment in SOUN, the negative earnings response was a chilling splash of reality, as the company’s financials didn’t quite live up to the hype.
What is the development for SoundHound AI?
SoundHound AI’s future potential, despite the recent earnings miss, is promising. First, their voice AI technology is legit. We are talking about solutions that can shake things up in industries like automotive, consumer electronics, etc. And let’s not forget that investment with Nvidia — which, while glossing over details, indicates the company has the foundations to be a strong player in AI.
Speaking of integration, SoundHound AI’s voice assistant integrates with ChatGPT Stellantis went into full production with DS Automobiles.Due to which the usage in the car increased a lot. They too Teamed up with Jersey Mike. VoiceAI to introduce iPhone ordering. Not too shabby, right?
And looking ahead, the company is forecasting serious top-line growth. They’re projecting more than half their revenue growth this year, and they are. Target sales of over $100 million by 2025. Pretty ambitious, especially when you consider they have a backlog of $661 million in orders.
What do analysts expect for Soundhound AI stock?
So, SoundHound AI stock has been on a wild ride, but analysts seem pretty optimistic about where it’s headed. Chief among them is AI Bull. Dan Ives from Wedbushwhich supported his bullish view after earnings.
Especially, Ives is a fan Soundhound AI’s innovative tech and strategic partnerships, and he thinks their voice recognition and natural language processing skills will be in high demand as more industries start using AI-powered solutions. Ives calls SOUN a “Buy” and has a Street High price target of $9 – which implies an expected upside of 50.5% from Monday’s closing price.
With 5 out of 6 analysts in coverage rating “Strong Buy,” most analysts are also bullish, and the average price target is $6.97 which represents a 16.5% premium to current levels.
The bottom line on SOUN stock
Yes, SoundHound AI may have been hit by a volatile stock market ride, but pros are still betting on a bright future. Of course, investing in speculative AI penny stocks is not for the faint of heart.
But for those willing to take risks, SoundHound AI could prove to be an interesting play in the rapidly evolving world of artificial intelligence. They have the will to make some serious noise in the tech, partnerships, and AI space. Just avoid betting form on this one – stick to a small stake, keep cool, and be sure to balance those “moonshot” bets with some more conservative picks.
At the date of publication, Ebube Jones did not have a position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy here for more information.
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.