SoundHound AI (NASDAQ:SOUN) Shares Up 7.7% - Should You Buy?

Key Points

• SoundHound AI shares rose 7.7% to $6.14 in mid-day trading, but remain below their 50-day and 200-day moving averages of $7.03 and $7.81, respectively.
• Analyst sentiment is broadly positive, with a “Moderate Buy” consensus and an average price target of $14.93, although Weiss Ratings maintains a “sell” rating.
• The company’s quarterly revenue increased 51.7% year over year to $44.2 million, beating estimates, but it missed on EPS and continues to report substantial losses, including a negative net margin of 91.84%.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report) shares were up 7.7% during mid-day trading on Thursday . The stock traded as high as $6.19 and last traded at $6.14. 26,536,704 shares were traded during mid-day trading, a decline of 6% from the average session volume of 28,348,666 shares. The stock had previously closed at $5.70.

Analyst Upgrades and Downgrades

A number of research analysts have recently issued reports on the stock. Weiss Ratings reaffirmed a "sell (e+)" rating on shares of SoundHound AI in a research report on Monday, June 15th. LADENBURG THALM/SH SH raised SoundHound AI to a "strong-buy" rating in a research report on Wednesday, May 6th. Finally, DA Davidson restated a "buy" rating and set a $14.00 target price on shares of SoundHound AI in a research note on Wednesday, April 22nd. One analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, three have given a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average price target of $14.93.

SoundHound AI Price Performance

The firm has a market capitalization of $2.66 billion, a price-to-earnings ratio of -13.06 and a beta of 2.62. The business has a fifty day moving average price of $7.03 and a two-hundred day moving average price of $7.81.

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

Insiders Place Their Bets

In other SoundHound AI news, SVP Majid Emami sold 28,843 shares of the company's stock in a transaction that occurred on 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 owned 472,983 shares in the company, valued at approximately $3,528,453.18. This represents a 5.75% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider James Ming Hom 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 transaction of $215,168.78. Following the transaction, the insider directly owned 743,521 shares of the company's stock, valued at approximately $5,546,666.66. This trade represents a 3.73% 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. Over the last quarter, insiders have sold 268,022 shares of company stock worth $1,999,444. 8.84% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of large investors have recently modified their holdings of the company. Vanguard Group Inc. grew its holdings in 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 purchasing an additional 1,909,868 shares during the period. Rakuten Securities Inc. raised its stake in shares of SoundHound AI by 877.9% during the 4th quarter. Rakuten Securities Inc. now owns 333,605 shares of the company's stock worth $3,326,000 after buying an additional 299,492 shares during the period. UBS Group AG raised its stake in shares of SoundHound AI by 77.6% during the 4th quarter. UBS Group AG now owns 6,124,283 shares of the company's stock worth $61,059,000 after buying an additional 2,676,707 shares during the period. Mitsubishi UFJ Asset Management Co. Ltd. lifted its position in shares of SoundHound AI by 140.5% during the 4th quarter. Mitsubishi UFJ Asset Management Co. Ltd. now owns 266,576 shares of the company's stock valued at $2,826,000 after buying an additional 155,743 shares in the last quarter. Finally, Geode Capital Management LLC lifted its position in shares of SoundHound AI by 3.1% during the 4th quarter. Geode Capital Management LLC now owns 9,180,321 shares of the company's stock valued at $91,543,000 after buying an additional 273,097 shares in the last quarter. Institutional investors and hedge funds own 19.28% of the company's stock.

SoundHound AI Company Profile

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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