SoundHound AI (NASDAQ:SOUN) Stock Price Down 1.5% - Should You Sell?

Key Points

• SoundHound AI shares fell 1.5% to $7.11, with the stock trading below its 200-day moving average of $7.38. Its market capitalization is approximately $3.16 billion.
• Analyst views remain mixed: the consensus rating is “Moderate Buy” with a $13.60 target price, although Piper Sandler and DA Davidson recently reduced their price targets to $7 and $10, respectively.
• The company exceeded quarterly expectations, reporting a loss of $0.02 per share versus the expected $0.13 loss and revenue of $61.9 million, up 45% year over year. However, it continues to report a negative net margin and return on equity.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report) shares dropped 1.5% during mid-day trading on Friday . The company traded as low as $7.02 and last traded at $7.11. Approximately 24,494,163 shares were traded during trading, a decline of 15% from the average session volume of 28,661,592 shares. The stock had previously closed at $7.22.

Analyst Upgrades and Downgrades

Several research analysts have issued reports on SOUN shares. Wall Street Zen raised shares of SoundHound AI from a "strong sell" rating to a "sell" rating in a research report on Saturday, August 15th. Piper Sandler lowered their price target on SoundHound AI from $8.00 to $7.00 and set a "neutral" rating on the stock in a report on Thursday, August 6th. DA Davidson dropped their price target on SoundHound AI from $12.00 to $10.00 and set a "buy" rating on the stock in a research report on Thursday, August 6th. Weiss Ratings reaffirmed a "sell (e+)" rating on shares of SoundHound AI in a research note on Monday, June 15th. Finally, LADENBURG THALM/SH SH upgraded SoundHound AI to a "strong-buy" rating in a research note on Wednesday, May 6th. One research analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $13.60.

SoundHound AI Stock Down 1.5%

The stock has a market capitalization of $3.16 billion, a PE ratio of -18.71 and a beta of 2.64. The firm's fifty day moving average is $6.71 and its 200-day moving average is $7.38.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last released its earnings results on Wednesday, August 5th. The company reported ($0.02) earnings per share (EPS) for the quarter, topping 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 quarterly revenue was up 45.0% on a year-over-year basis. During the same quarter in the previous year, the firm posted ($0.19) EPS. On average, analysts expect that SoundHound AI, Inc. will post -0.33 EPS for the current year.

Insider Buying and Selling at SoundHound AI

In related news, insider James Ming Hom sold 28,843 shares of the firm's stock in a transaction dated Monday, June 15th. The shares were sold at an average price of $7.46, for a total value of $215,168.78. Following the completion of the sale, the insider owned 743,521 shares in the company, valued at $5,546,666.66. This trade represents a 3.73% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, COO Michael Zagorsek sold 64,994 shares of SoundHound AI stock in a transaction on Monday, June 15th. The stock was sold at an average price of $7.46, for a total value of $484,855.24. Following the transaction, the chief operating officer directly owned 1,669,497 shares of the company's stock, valued at approximately $12,454,447.62. This represents a 3.75% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 268,022 shares of company stock worth $1,999,444. Company insiders own 8.84% of the company's stock.

Hedge Funds Weigh In On SoundHound AI

Hedge funds have recently added to or reduced their stakes in the business. Royal Bank of Canada grew its position in shares of SoundHound AI by 71.3% in the first quarter. Royal Bank of Canada now owns 160,299 shares of the company's stock valued at $1,301,000 after purchasing an additional 66,714 shares during the last quarter. Integrated Wealth Concepts LLC increased its position in SoundHound AI by 8.9% during the first quarter. Integrated Wealth Concepts LLC now owns 14,676 shares of the company's stock worth $119,000 after buying an additional 1,201 shares in the last quarter. NewEdge Advisors LLC raised its holdings in shares of 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 acquiring an additional 4,692 shares during the last quarter. Goldman Sachs Group Inc. lifted its position in shares of SoundHound AI by 69.8% in the first quarter. Goldman Sachs Group Inc. now owns 2,639,689 shares of the company's stock valued at $21,434,000 after acquiring an additional 1,085,473 shares in the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its stake in shares of SoundHound AI by 10.1% during 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 valued at $5,620,000 after acquiring an additional 63,398 shares during the last quarter. 19.28% of the stock is currently owned by hedge funds and other institutional investors.

About SoundHound AI

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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