SoundHound AI (NASDAQ:SOUN) Shares Down 7% - Here's What Happened

Key Points

• SoundHound AI's stock fell by 7% on Wednesday, with approximately 19.8 million shares traded, substantially below its average daily volume.
• In recent analyst reports, ratings for SoundHound AI have varied, with Piper Sandler maintaining a "neutral" rating and a $12.00 target, while other firms like LADENBURG THALM/SH SH have upgraded it to a "buy" with a $16.00 price target.
• SoundHound AI reported a revenue of $42.68 million for the last quarter, significantly exceeding analyst estimates, although it posted a loss of ($0.19) EPS, which was lower than the consensus estimate of ($0.06).

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report) dropped 7% on Wednesday . The company traded as low as $12.03 and last traded at $12.37. Approximately 19,836,504 shares traded hands during mid-day trading, a decline of 52% from the average daily volume of 41,133,902 shares. The stock had previously closed at $13.30.

Wall Street Analysts Forecast Growth

Several equities research analysts have weighed in on the company. Piper Sandler reaffirmed a "neutral" rating and issued a $12.00 target price on shares of SoundHound AI in a research report on Monday, July 14th. Wall Street Zen lowered SoundHound AI from a "hold" rating to a "sell" rating in a research report on Saturday, August 9th. LADENBURG THALM/SH SH raised SoundHound AI from a "neutral" rating to a "buy" rating and increased their target price for the stock from $9.00 to $16.00 in a research report on Monday, August 11th. Wedbush raised their price target on SoundHound AI from $15.00 to $16.00 and gave the company an "outperform" rating in a report on Friday, August 8th. Finally, Northland Securities raised shares of SoundHound AI from a "market perform" rating to an "outperform" rating and set a $14.50 price objective on the stock in a research report on Friday, August 8th. One investment analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and three have given a Hold rating to the company's stock. According to MarketBeat, SoundHound AI presently has an average rating of "Moderate Buy" and an average target price of $13.36.

SoundHound AI Stock Down 6.5%

The firm has a market capitalization of $5.00 billion, a P/E ratio of -19.63 and a beta of 2.57. The stock has a fifty day moving average of $11.54 and a 200-day moving average of $10.54.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last issued its quarterly earnings results on Thursday, August 7th. The company reported ($0.19) EPS for the quarter, missing the consensus estimate of ($0.06) by ($0.13). SoundHound AI had a negative net margin of 171.81% and a negative return on equity of 73.13%. The company had revenue of $42.68 million for the quarter, compared to analyst estimates of $32.88 million. During the same period last year, the company posted ($0.11) earnings per share. The business's revenue for the quarter was up 216.3% on a year-over-year basis. SoundHound AI has set its FY 2025 guidance at EPS. Sell-side analysts predict that SoundHound AI, Inc. will post -0.38 EPS for the current fiscal year.

Insider Buying and Selling

In other news, COO Michael Zagorsek sold 117,180 shares of the company's stock in a transaction that occurred on Friday, June 20th. The stock was sold at an average price of $9.36, for a total value of $1,096,804.80. Following the completion of the transaction, the chief operating officer directly owned 1,346,455 shares of the company's stock, valued at $12,602,818.80. This represents a 8.01% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, VP Majid Emami sold 132,352 shares of the stock in a transaction on Tuesday, June 10th. The shares were sold at an average price of $10.04, for a total value of $1,328,814.08. Following the transaction, the vice president directly owned 537,482 shares of the company's stock, valued at approximately $5,396,319.28. This trade represents a 19.76% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 913,317 shares of company stock worth $8,679,813 over the last three months. Insiders own 9.17% of the company's stock.

Institutional Investors Weigh In On SoundHound AI

Institutional investors and hedge funds have recently made changes to their positions in the business. Virtu Financial LLC bought a new stake in SoundHound AI during the first quarter worth about $2,395,000. Carnegie Investment Counsel lifted its stake in SoundHound AI by 8.9% during the first quarter. Carnegie Investment Counsel now owns 1,069,860 shares of the company's stock worth $8,131,000 after purchasing an additional 87,810 shares during the last quarter. Thoroughbred Financial Services LLC lifted its stake in SoundHound AI by 38.4% during the first quarter. Thoroughbred Financial Services LLC now owns 113,475 shares of the company's stock worth $921,000 after purchasing an additional 31,500 shares during the last quarter. Liontrust Investment Partners LLP bought a new stake in SoundHound AI during the first quarter worth about $1,639,000. Finally, Yarbrough Capital LLC bought a new stake in SoundHound AI during the first quarter worth about $1,258,000. Hedge funds and other institutional investors own 19.28% of the company's stock.

About SoundHound AI

SoundHound AI, Inc develops independent voice artificial intelligence (AI) solutions that enables businesses across automotive, TV, and IoT, and to customer service industries to deliver high-quality conversational experiences to their customers. Its products include Houndify platform that offers a suite of Houndify tools to help brands build conversational voice assistants, such as Application Programming Interfaces (API) for text and voice queries, support for custom commands, extensive library of content domains, inclusive software development kit platforms, collaboration capabilities, diagnostic tools, and built-in analytics; SoundHound Chat AI that integrates with knowledge domains, pulling real-time data like weather, sports, stocks, flight status, and restaurants; and SoundHound Smart Answering is built to offer customer establishments custom AI-powered voice assistant.

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