SoundHound AI (NASDAQ:SOUN) Sets New 1-Year Low - Time to Sell?

Key Points

• SoundHound AI shares fell to a new 52-week low of $4.36, well below their 50-day and 200-day moving averages of $6.12 and $6.91.
• Analyst sentiment remains mixed but leans positive: the stock carries a “Moderate Buy” consensus rating and an average price target of $11.50, despite several recent target cuts and some sell or strong-sell ratings.
• The company beat quarterly revenue and EPS expectations, with revenue up 45% year over year, but it remains unprofitable with a negative net margin and analysts projecting a full-year loss. Insiders also sold shares totaling about $1.83 million in the last quarter, primarily to cover tax obligations.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report) reached a new 52-week low during trading on Friday. The company traded as low as $4.36 and last traded at $4.4650, with a volume of 1,423,882 shares trading hands. The stock had previously closed at $4.50.

Wall Street Analyst Weigh In

Several brokerages recently commented on SOUN. Yorkville Ives initiated coverage on SoundHound AI in a research report on Monday, October 5th. They issued an "in-line" rating and a $6.50 target price for the company. DA Davidson decreased their price target on SoundHound AI from $12.00 to $10.00 and set a "buy" rating for the company in a research note on Thursday, August 6th. Piper Sandler lowered their price target on SoundHound AI from $7.00 to $6.00 and set a "neutral" rating on the stock in a research report on Tuesday, September 22nd. Weiss Ratings raised SoundHound AI from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Thursday, October 15th. Finally, Wall Street Zen lowered SoundHound AI from a "sell" rating to a "strong sell" rating in a report on Saturday, September 26th. One investment analyst has rated the stock with a Strong Buy rating, three have given a Buy rating, three have given a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, SoundHound AI presently has an average rating of "Moderate Buy" and an average price target of $11.50.

SoundHound AI Price Performance

The stock has a market capitalization of $1.96 billion, a P/E ratio of -11.64 and a beta of 2.73. The stock's fifty day moving average is $6.12 and its two-hundred day moving average is $6.91.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last posted its quarterly earnings results on Wednesday, August 5th. The company reported ($0.02) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.13) by $0.11. The company had revenue of $61.90 million for the quarter, compared to analysts' expectations of $52.38 million. SoundHound AI had a negative return on equity of 30.22% and a negative net margin of 67.45%. The firm's revenue was up 45.0% on a year-over-year basis. During the same quarter in the prior year, the company earned ($0.19) earnings per share. Analysts expect that SoundHound AI, Inc. will post -0.32 EPS for the current year.

Insider Buying and Selling

In other news, insider James Hom sold 38,730 shares of the business's stock in a transaction that occurred on Tuesday, September 15th. The shares were sold at an average price of $6.33, for a total transaction of $245,160.90. Following the sale, the insider owned 1,105,555 shares in the company, valued at $6,998,163.15. The trade was a 3.38% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, COO Michael Zagorsek sold 71,113 shares of the business's stock in a transaction that occurred on Tuesday, September 15th. The shares were sold at an average price of $6.33, for a total transaction of $450,145.29. Following the sale, the chief operating officer owned 2,600,231 shares in the company, valued at $16,459,462.23. This represents a 2.66% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 288,758 shares of company stock worth $1,828,598 in the last quarter. 8.84% of the stock is currently owned by corporate insiders.

Institutional Trading of SoundHound AI

Large investors have recently added to or reduced their stakes in the company. Swiss National Bank grew its stake in SoundHound AI by 3.7% during the 1st quarter. Swiss National Bank now owns 767,100 shares of the company's stock valued at $5,270,000 after acquiring an additional 27,300 shares in the last quarter. California State Teachers Retirement System increased its holdings in shares of SoundHound AI by 25.0% in the 1st quarter. California State Teachers Retirement System now owns 440,023 shares of the company's stock valued at $3,023,000 after purchasing an additional 87,998 shares during the period. AXQ Capital LP lifted its position in shares of SoundHound AI by 395.6% in the second quarter. AXQ Capital LP now owns 254,744 shares of the company's stock worth $1,648,000 after purchasing an additional 203,345 shares in the last quarter. SG Americas Securities LLC purchased a new stake in shares of SoundHound AI in the first quarter worth approximately $1,606,000. Finally, Themes Management Co LLC boosted its holdings in shares of SoundHound AI by 86.5% during the first quarter. Themes Management Co LLC now owns 191,444 shares of the company's stock worth $1,315,000 after purchasing an additional 88,820 shares during the period. 19.28% of the stock is owned by institutional investors and hedge funds.

SoundHound AI Company Profile

SoundHound AI, Inc develops voice artificial intelligence and conversational intelligence technologies. Its platform is designed to enable people to interact with devices, applications and services using natural language, with capabilities including speech recognition, language understanding and conversational response generation.

The company's offerings include the Houndify platform, which businesses can use to create branded voice assistants and conversational interfaces. SoundHound AI also provides voice-enabled solutions for industries such as automotive, restaurants and customer service, allowing users to access information, control functions, place orders and engage with businesses through voice interactions.

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