Investors Buy Large Volume of Call Options on SoundHound AI (NASDAQ:SOUN)

Key Points

• Unusually heavy options activity: Traders bought 158,395 call options on SoundHound AI on Friday, more than double the average daily call volume and a 105% increase versus normal levels.
• Stock and earnings mixed: SOUN rose 5.1% to $9.00 on above-average trading volume, while its latest quarterly earnings missed EPS estimates but revenue came in above expectations and grew 51.7% year over year.
• Analyst sentiment remains cautiously positive: Recent ratings were mixed, but the stock now carries a consensus “Moderate Buy” with an average price target of $14.93 despite some lowered targets.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report) was the target of unusually large options trading activity on Friday. Traders purchased 158,395 call options on the company. This is an increase of 105% compared to the average daily volume of 77,261 call options.

Analyst Ratings Changes

A number of research firms have recently weighed in on SOUN. Piper Sandler reaffirmed a "neutral" rating and issued a $9.00 price target (down from $11.00) on shares of SoundHound AI in a research note on Friday, February 27th. LADENBURG THALM/SH SH raised shares of SoundHound AI to a "strong-buy" rating in a research report on Wednesday, May 6th. HC Wainwright lowered their target price on shares of SoundHound AI from $26.00 to $20.00 and set a "buy" rating on the stock in a research report on Monday, March 2nd. Zacks Research raised shares of SoundHound AI from a "strong sell" rating to a "hold" rating in a research report on Monday, February 9th. Finally, DA Davidson reissued a "buy" rating and set a $14.00 target price on shares of SoundHound AI in a research report on Wednesday, April 22nd. One analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, three have issued a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat, the company presently has an average rating of "Moderate Buy" and a consensus price target of $14.93.

SoundHound AI Stock Up 5.1%

SOUN stock traded up $0.44 during mid-day trading on Friday, reaching $9.00. 40,310,991 shares of the stock traded hands, compared to its average volume of 27,493,682. SoundHound AI has a 52 week low of $5.83 and a 52 week high of $22.17. The business has a 50-day moving average of $7.64 and a two-hundred day moving average of $9.26. The firm has a market capitalization of $3.89 billion, a PE ratio of -19.15 and a beta of 2.58.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last released its earnings results on Thursday, May 7th. The company reported ($0.06) earnings per share for the quarter, missing the consensus estimate of ($0.05) by ($0.01). SoundHound AI had a negative net margin of 91.84% and a negative return on equity of 40.15%. The company had revenue of $44.20 million during the quarter, compared to the consensus estimate of $42.56 million. During the same quarter in the previous year, the business posted ($0.06) EPS. The firm's quarterly revenue was up 51.7% on a year-over-year basis. On average, equities research analysts anticipate that SoundHound AI will post -0.43 EPS for the current fiscal year.

Insiders Place Their Bets

In other news, CEO Keyvan Mohajer sold 124,510 shares of the company's stock in a transaction on Friday, March 20th. The shares were sold at an average price of $6.79, for a total value of $845,422.90. Following the transaction, the chief executive officer directly owned 2,073,777 shares of the company's stock, valued at approximately $14,080,945.83. This represents a 5.66% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, insider James Ming Hom sold 31,019 shares of the company's stock in a transaction on Friday, March 20th. The stock was sold at an average price of $6.79, for a total transaction of $210,619.01. Following the completion of the transaction, the insider directly owned 772,364 shares in the company, valued at $5,244,351.56. This trade represents a 3.86% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 307,973 shares of company stock valued at $2,091,110 in the last three months. Company insiders own 8.84% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds have recently added to or reduced their stakes in SOUN. Royal Bank of Canada raised its position in SoundHound AI by 71.3% in the first quarter. Royal Bank of Canada now owns 160,299 shares of the company's stock worth $1,301,000 after purchasing an additional 66,714 shares in the last quarter. Integrated Wealth Concepts LLC raised its position in SoundHound AI by 8.9% in the first quarter. Integrated Wealth Concepts LLC now owns 14,676 shares of the company's stock worth $119,000 after purchasing an additional 1,201 shares in the last quarter. NewEdge Advisors LLC raised its position in SoundHound AI by 12.9% in the first quarter. NewEdge Advisors LLC now owns 41,030 shares of the company's stock worth $333,000 after purchasing an additional 4,692 shares in the last quarter. Goldman Sachs Group Inc. raised its position in SoundHound AI by 69.8% in the first quarter. Goldman Sachs Group Inc. now owns 2,639,689 shares of the company's stock worth $21,434,000 after purchasing an additional 1,085,473 shares in the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its position in SoundHound AI by 10.1% in the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 692,170 shares of the company's stock worth $5,620,000 after purchasing an additional 63,398 shares in the last quarter. Institutional investors and hedge funds own 19.28% of the company's stock.

SoundHound AI Company Profile

SoundHound AI, Inc is a voice AI and conversational intelligence company specializing in speech recognition, natural language understanding and sound identification technologies. Founded in 2005 and headquartered in Santa Clara, California, the company initially gained recognition with its music discovery app before pivoting to enterprise-grade voice AI solutions. Over the years, SoundHound AI has built a comprehensive platform that enables developers and businesses to embed conversational intelligence into a wide range of products and services.

The company's core offering is the Houndify voice AI platform, which provides customizable speech-to-meaning technology, domain-specific natural language understanding and text-to-speech capabilities.

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