SoundHound AI (NASDAQ:SOUN) Lowered to Strong Sell Rating by Zacks Research

Key Points

• Zacks Research downgraded SoundHound AI to a strong sell from hold in a report issued Monday.
• Analyst coverage is mixed—2 Strong Buy, 5 Buy, 2 Hold and 2 Sell—resulting in an average rating of “Moderate Buy” and an average price target of $16.07.
• Company insiders (including the CEO and CFO) sold shares in late December, and although revenue rose 67.6% year-over-year, SoundHound remains unprofitable with a negative net margin (~211%) and negative EPS guidance.

SoundHound AI (NASDAQ:SOUN - Get Free Report) was downgraded by research analysts at Zacks Research from a "hold" rating to a "strong sell" rating in a report issued on Monday,Zacks.com reports.

A number of other brokerages have also issued reports on SOUN. LADENBURG THALM/SH SH raised SoundHound AI to a "strong-buy" rating in a research note on Thursday, December 18th. Weiss Ratings reissued a "sell (d-)" rating on shares of SoundHound AI in a research report on Friday. Cantor Fitzgerald upgraded shares of SoundHound AI from a "neutral" rating to an "overweight" rating and boosted their target price for the company from $13.00 to $15.00 in a report on Friday, December 12th. HC Wainwright upped their price target on shares of SoundHound AI from $18.00 to $26.00 and gave the stock a "buy" rating in a research report on Thursday, October 16th. Finally, Piper Sandler cut their price target on shares of SoundHound AI from $15.00 to $11.00 and set a "neutral" rating on the stock in a research note on Monday, January 5th. Two research analysts have rated the stock with a Strong Buy rating, five have given a Buy rating, two have assigned a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average price target of $16.07.

SoundHound AI Stock Performance

Shares of NASDAQ:SOUN opened at $11.08 on Monday. The business's fifty day moving average price is $11.73 and its two-hundred day moving average price is $13.57. The stock has a market cap of $4.65 billion, a PE ratio of -13.19 and a beta of 2.65. SoundHound AI has a one year low of $6.52 and a one year high of $22.17.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last issued its quarterly earnings data on Thursday, November 6th. The company reported ($0.03) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.09) by $0.06. The business had revenue of $42.05 million for the quarter, compared to the consensus estimate of $40.48 million. SoundHound AI had a negative return on equity of 93.64% and a negative net margin of 211.16%.The business's revenue was up 67.6% on a year-over-year basis. During the same period in the prior year, the business earned ($0.04) earnings per share. As a group, equities research analysts predict that SoundHound AI will post -0.38 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other SoundHound AI news, CEO Keyvan Mohajer sold 144,326 shares of the firm's stock in a transaction dated Monday, December 22nd. The stock was sold at an average price of $11.28, for a total value of $1,627,997.28. Following the transaction, the chief executive officer directly owned 2,198,287 shares of the company's stock, valued at $24,796,677.36. This trade represents a 6.16% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, CFO Nitesh Sharan sold 60,780 shares of the business's stock in a transaction that occurred on Monday, December 22nd. The stock was sold at an average price of $11.28, for a total value of $685,598.40. Following the transaction, the chief financial officer directly owned 1,705,148 shares in the company, valued at $19,234,069.44. This trade represents a 3.44% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders have sold 462,265 shares of company stock worth $5,216,518. 9.17% of the stock is owned by company insiders.

Institutional Trading of SoundHound AI

A number of hedge funds and other institutional investors have recently modified their holdings of the business. Sound Income Strategies LLC boosted its holdings in SoundHound AI by 37.3% in the third quarter. Sound Income Strategies LLC now owns 2,116 shares of the company's stock valued at $34,000 after purchasing an additional 575 shares during the last quarter. Investors Research Corp raised its position in shares of SoundHound AI by 62.4% in the 3rd quarter. Investors Research Corp now owns 1,822 shares of the company's stock valued at $29,000 after purchasing an additional 700 shares in the last quarter. EP Wealth Advisors LLC boosted its stake in shares of SoundHound AI by 5.3% during the 2nd quarter. EP Wealth Advisors LLC now owns 14,100 shares of the company's stock valued at $151,000 after buying an additional 706 shares during the last quarter. Newbridge Financial Services Group Inc. grew its position in shares of SoundHound AI by 2.7% during the third quarter. Newbridge Financial Services Group Inc. now owns 31,880 shares of the company's stock worth $513,000 after buying an additional 830 shares in the last quarter. Finally, Insigneo Advisory Services LLC grew its position in shares of SoundHound AI by 7.4% during the third quarter. Insigneo Advisory Services LLC now owns 12,416 shares of the company's stock worth $200,000 after buying an additional 858 shares in the last quarter. 19.28% of the stock is 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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