SoundHound AI (NASDAQ:SOUN) Trading Down 2.7% - Here's Why

Key Points

• SoundHound AI shares fell 2.7% to $6.24 in heavy trading, with volume 46% above the daily average. The stock remains below its 50-day and 200-day moving averages.
• Analysts maintain a generally positive view, with a consensus rating of “Moderate Buy” and an average price target of $14.93, despite ratings ranging from sell to strong buy.
• Quarterly revenue rose 51.7% year over year to $44.2 million, exceeding estimates, but the company missed on EPS and continues to report substantial losses and negative profitability metrics.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report)'s share price traded down 2.7% during trading on Tuesday . The company traded as low as $6.02 and last traded at $6.24. 41,227,507 shares changed hands during mid-day trading, an increase of 46% from the average daily volume of 28,213,232 shares. The stock had previously closed at $6.41.

Analyst Upgrades and Downgrades

SOUN has been the subject of a number of recent analyst reports. 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. Weiss Ratings restated a "sell (e+)" rating on shares of SoundHound AI in a research report on Monday, June 15th. Finally, LADENBURG THALM/SH SH raised shares of SoundHound AI to a "strong-buy" rating in a research note on Wednesday, May 6th. One research 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. Based on data from MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average target price of $14.93.

SoundHound AI Stock Performance

The company has a market capitalization of $2.70 billion, a price-to-earnings ratio of -13.28 and a beta of 2.62. The business has a 50 day moving average price of $7.13 and a 200-day moving average price of $7.88.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last released its 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). SoundHound AI had a negative return on equity of 40.15% and a negative net margin of 91.84%.The business had revenue of $44.20 million for the quarter, compared to analyst estimates of $42.56 million. During the same period in the prior year, the business earned ($0.06) EPS. The company's revenue for the quarter was up 51.7% on a year-over-year basis. As a group, equities analysts predict that SoundHound AI, Inc. will post -0.45 EPS for the current fiscal year.

Insider Activity at SoundHound AI

In other news, CTO Timothy Stonehocker sold 18,802 shares of SoundHound AI stock in a transaction on Monday, June 15th. The shares were sold at an average price of $7.46, for a total value of $140,262.92. Following the completion of the sale, the chief technology officer owned 502,290 shares in the company, valued at $3,747,083.40. The trade was a 3.61% decrease in their position. The transaction 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 the firm's stock in a transaction on Monday, June 15th. The stock was sold at an average price of $7.46, for a total transaction of $215,168.78. Following the completion of the sale, the senior vice president owned 472,983 shares of the company's stock, valued at $3,528,453.18. The trade was a 5.75% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 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. Corporate insiders own 8.84% of the company's stock.

Institutional Trading of SoundHound AI

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Morgan Stanley raised its stake in SoundHound AI by 48.1% during the 4th quarter. Morgan Stanley now owns 8,987,522 shares of the company's stock worth $89,606,000 after buying an additional 2,917,280 shares during the period. UBS Group AG increased its holdings in shares of SoundHound AI by 77.6% during the fourth quarter. UBS Group AG now owns 6,124,283 shares of the company's stock valued at $61,059,000 after acquiring an additional 2,676,707 shares in the last quarter. Voloridge Investment Management LLC increased its holdings in shares of SoundHound AI by 2,259.7% during the fourth quarter. Voloridge Investment Management LLC now owns 2,199,511 shares of the company's stock valued at $21,929,000 after acquiring an additional 2,106,298 shares in the last quarter. Vanguard Group Inc. raised its position in shares of SoundHound AI by 4.4% during the fourth quarter. Vanguard Group Inc. now owns 45,367,437 shares of the company's stock worth $452,313,000 after purchasing an additional 1,909,868 shares during the period. Finally, Jump Financial LLC bought a new position in shares of SoundHound AI in the 3rd quarter worth $21,679,000. 19.28% of the stock is owned by institutional investors.

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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