SoundHound AI (NASDAQ:SOUN) Shares Down 6.4% - Here's What Happened

Key Points

• SoundHound AI shares fell 6.4% on Tuesday, trading as low as $6.44, with volume below the usual pace as about 20.5 million shares changed hands.
• Recent analyst commentary was mixed, but the overall view remains Moderate Buy; however, HC Wainwright cut its price target to $20 and Piper Sandler lowered its target to $9.
• The company reported mixed quarterly results: revenue rose 51.7% year over year to $44.2 million, but EPS missed expectations, and insiders recently sold shares to cover tax withholding obligations.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report)'s stock price fell 6.4% during trading on Tuesday . The stock traded as low as $6.44 and last traded at $6.44. 20,499,013 shares changed hands during mid-day trading, a decline of 25% from the average session volume of 27,353,273 shares. The stock had previously closed at $6.88.

Wall Street Analyst Weigh In

A number of equities research analysts recently issued reports on the stock. HC Wainwright dropped their target price on shares of SoundHound AI from $26.00 to $20.00 and set a "buy" rating for the company in a research report on Monday, March 2nd. Weiss Ratings restated a "sell (e+)" rating on shares of SoundHound AI in a research report on Monday, June 15th. DA Davidson reaffirmed a "buy" rating and set a $14.00 price objective on shares of SoundHound AI in a research note on Wednesday, April 22nd. Piper Sandler reiterated a "neutral" rating and issued a $9.00 target price (down from $11.00) on shares of SoundHound AI in a research note on Friday, February 27th. Finally, LADENBURG THALM/SH SH upgraded SoundHound AI to a "strong-buy" rating in a research report on Wednesday, May 6th. One analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, three have issued a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, SoundHound AI has an average rating of "Moderate Buy" and a consensus target price of $14.93.

SoundHound AI Price Performance

The firm has a market capitalization of $2.79 billion, a P/E ratio of -13.70 and a beta of 2.56. The company's 50 day moving average price is $7.96 and its 200 day moving average price is $8.72.

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

Insider Activity

In other SoundHound AI news, COO Michael Zagorsek sold 64,994 shares of the business's stock in a transaction dated Monday, June 15th. The stock was sold at an average price of $7.46, for a total value of $484,855.24. Following the completion of the transaction, the chief operating officer directly owned 1,669,497 shares of the company's stock, valued at approximately $12,454,447.62. The trade was a 3.75% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. 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 the firm's stock in a transaction dated Monday, June 15th. The stock was sold at an average price of $7.46, for a total value of $215,168.78. Following the sale, the senior vice president directly owned 472,983 shares in the company, valued at approximately $3,528,453.18. This represents a 5.75% decrease in their position. 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 90 days, insiders have sold 268,022 shares of company stock valued at $1,999,444. 8.84% of the stock is currently owned by company insiders.

Institutional Trading of SoundHound AI

A number of large investors have recently bought and sold shares of SOUN. Vanguard Group Inc. boosted its holdings in shares of SoundHound AI by 4.4% in the fourth quarter. Vanguard Group Inc. now owns 45,367,437 shares of the company's stock valued at $452,313,000 after buying an additional 1,909,868 shares during the period. Geode Capital Management LLC lifted its position in SoundHound AI by 3.1% in the 4th quarter. Geode Capital Management LLC now owns 9,180,321 shares of the company's stock valued at $91,543,000 after acquiring an additional 273,097 shares in the last quarter. Morgan Stanley lifted its position in SoundHound AI by 48.1% in the 4th quarter. Morgan Stanley now owns 8,987,522 shares of the company's stock valued at $89,606,000 after acquiring an additional 2,917,280 shares in the last quarter. State Street Corp boosted its stake in SoundHound AI by 0.9% in the 4th quarter. State Street Corp now owns 8,691,235 shares of the company's stock worth $86,652,000 after purchasing an additional 80,908 shares during the period. Finally, UBS Group AG boosted its stake in SoundHound AI by 77.6% in the 4th quarter. UBS Group AG now owns 6,124,283 shares of the company's stock worth $61,059,000 after purchasing an additional 2,676,707 shares during the period. 19.28% of the stock is owned by 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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