SoundHound AI (NASDAQ:SOUN) Shares Down 2.1% - Should You Sell?

Key Points

• SoundHound AI shares fell 2.1% in Thursday trading, slipping to around $6.21 after touching a low of $6.08, with volume running above average.
• Wall Street sentiment remains mixed but generally positive: the stock carries a Moderate Buy consensus, though recent analyst actions included price target cuts and one sell rating. The average target price is $14.93, well above the current share price.
• The company’s latest earnings showed revenue growth of 51.7% year over year to $44.2 million, but it still posted a small EPS miss and remains unprofitable. Recent insider selling by top executives also added to investor attention.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report)'s stock price fell 2.1% during mid-day trading on Thursday . The stock traded as low as $6.08 and last traded at $6.21. Approximately 30,133,856 shares changed hands during mid-day trading, an increase of 10% from the average daily volume of 27,405,748 shares. The stock had previously closed at $6.34.

Analyst Ratings Changes

A number of equities analysts recently commented on the company. Piper Sandler reissued a "neutral" rating and set a $9.00 price target (down from $11.00) on shares of SoundHound AI in a research note on Friday, February 27th. HC Wainwright decreased their price objective on shares of SoundHound AI from $26.00 to $20.00 and set a "buy" rating for the company in a report on Monday, March 2nd. 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. LADENBURG THALM/SH SH raised shares of SoundHound AI to a "strong-buy" rating in a research report on Wednesday, May 6th. Finally, Weiss Ratings reaffirmed a "sell (e+)" rating on shares of SoundHound AI in a research report on Monday, June 15th. One investment analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat.com, SoundHound AI presently has a consensus rating of "Moderate Buy" and an average target price of $14.93.

SoundHound AI Price Performance

The firm has a fifty day moving average of $7.95 and a 200 day moving average of $8.63. The stock has a market cap of $2.69 billion, a price-to-earnings ratio of -13.21 and a beta of 2.56.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last released its quarterly earnings results on Thursday, May 7th. The company reported ($0.06) EPS for the quarter, missing the consensus estimate of ($0.05) by ($0.01). The firm had revenue of $44.20 million for the quarter, compared to analysts' expectations of $42.56 million. SoundHound AI had a negative return on equity of 40.15% and a negative net margin of 91.84%.The company's quarterly revenue was up 51.7% on a year-over-year basis. During the same quarter in the prior year, the business earned ($0.06) earnings per share. Research analysts anticipate that SoundHound AI, Inc. will post -0.45 earnings per share for the current fiscal year.

Insider Buying and Selling

In other news, CTO Timothy Stonehocker sold 18,802 shares of the business's stock in a transaction dated Monday, June 15th. The shares were sold at an average price of $7.46, for a total transaction of $140,262.92. Following the transaction, the chief technology officer directly owned 502,290 shares in the company, valued at $3,747,083.40. The trade was a 3.61% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, SVP Majid Emami sold 28,843 shares of SoundHound AI stock in a transaction that occurred on 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 senior vice president owned 472,983 shares in the company, valued at approximately $3,528,453.18. This trade represents a 5.75% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last ninety days, insiders sold 268,022 shares of company stock worth $1,999,444. 8.84% of the stock is currently owned by insiders.

Hedge Funds Weigh In On SoundHound AI

Large investors have recently bought and sold shares of the stock. Empowered Funds LLC increased its position in shares of SoundHound AI by 19.6% in the first quarter. Empowered Funds LLC now owns 13,896 shares of the company's stock worth $95,000 after acquiring an additional 2,277 shares in the last quarter. NewEdge Advisors LLC grew its position in shares of SoundHound AI by 62.1% during the first quarter. NewEdge Advisors LLC now owns 95,657 shares of the company's stock worth $657,000 after buying an additional 36,644 shares in the last quarter. Verus Capital Partners LLC bought a new stake in shares of SoundHound AI in the first quarter worth $71,000. Amundi raised its holdings in SoundHound AI by 112.4% in the first quarter. Amundi now owns 24,046 shares of the company's stock valued at $165,000 after acquiring an additional 12,725 shares in the last quarter. Finally, California State Teachers Retirement System raised its holdings in SoundHound AI by 25.0% in the first quarter. California State Teachers Retirement System now owns 440,023 shares of the company's stock valued at $3,023,000 after acquiring an additional 87,998 shares in the last quarter. Hedge funds and other institutional investors own 19.28% of the company's stock.

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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