$SOUN: AI-Sound Investment for the Future?

I swear that I felt like I was doing an ala Ms Cathie Wood when I decided to share this post.

Why the “weird” sentiments:

  • Firstly, unsure how reactive readers will be, over a “potential” AI stocks.

  • More importantly, I feel that by sharing, it’s almost like I am endorsing it - just like what Ms Wood would shamelessly do.

So, I emphasize again, this is strictly a sharing post.

Whether it is compelling an investment, everyone needs to further their own due diligence.

Background.

I first noticed $SoundHound AI Inc(SOUN)$ in a post revealing $NVIDIA Corp(NVDA)$ 13F filing that consisted new purchases including SOUN and 2 other companies. (see below)

I made a conscious effort not to read about it because I had other stocks on my radar.

When it comes to investing, I am learning (slowly albeit surely) that I need to follow my game plan, march to my own beat & rhythm and not anyone’s else’s.

Six Weeks on !

Fast forward 6 weeks later (that’s a lot of US trading times in US market) I crossed path with SOUN again.

With “nothing pressing” this time, I decided to examine SOUN and see where it could take me.

Afterall, even current IT giants $Alphabet(GOOG)$, $Microsoft(MSFT)$ and $Apple(AAPL)$ — they all had humble beginnings.

Why not SOUN?

I am sharing a post from InvestorPlace. (see above)

SoundHound AI (SOUN) is a volatile stock, on an overall uptrend.

  • It is an interesting company with strong revenue growth.

  • It is also, a notable short seller - Capybara Research’s target.

SOUN occupies a specific niche in the AI technology space.

Specifically, the company product is a “voice AI solution” that let businesses offer incredible conversational experiences to their customers.

Core Business Bases.

SoundHound AI's platform (Houndify) has secured customers in two main sectors.

(1) Automotive industry.

  • SOUN made the most progress selling into this industry.

  • It has relationships with over 20 auto brands, including (a) Honda, (b) Jeep, (c) Hyundai, (d) Fiat, (e) Chrysler, and (f) RAM, among others.

  • In Q4 2023 it won a deal with a Stellantis to install Houndify in its vehicle, significantly increasing its unit volumes through 2037.

(2) Food & Beverage Industry.

  • SOUN has also been making big strides in the quick-service restaurant vertical.

  • Its AI voice assistant app will take phone orders, so employees do not need to answer calls and focus on helping customers instead.

  • It also has solutions for drive-thrus and kiosks.

  • Clients include White Castle, Jersey Mike's (quick service chains eateries), among others.

  • SOUN has also signed deals with restaurant-focused fintech companies such as Toast and Olo.

Gil Luria, Analyst - DA Davidson has:

  • Reiterated a “Buy” rating.

  • Hiked its price target from $7.50 to $9.50.

Although the revision is encouraging, not everyone is a big fan of it.

SoundHound AI

  • SOUN has been rising from mid-February 2024 onwards. (see above)

  • However, its extreme peaks & troughs movements might shake out some investors.

  • YTD, this stock has move from less than $2 to $9 and then back to the $6 region.

  • SOUN’s volatility makes Luria’s $9.50 price target seem possible.

  • It also means that SOUN could decline to a much lower price point as well.

How much lower?

Two reports from Capybara Research, acknowledged its short position in the sound AI stock.

  • Its report said share price could fall to $1.00 per share.

  • Capybara’s main criticism about SOUN “(a) it is losing money and (b) no clear path to profitability.”

Facts and Supporter.

(1) 2023 Quarterly earnings.

  • In Q4 2023, SOUN generated $17.1 million in revenue.

  • It was a +80% gain YoY.

  • Gross margin improved by +6% YOY to 77%.

  • For Q4 2023, it reported a net earnings loss of -$0.07 per share versus a net loss of $0.15 per share YoY.

  • Last but not least, SOUN is trading at an over 26x price-to-sales (P/S) ratio.

With the company still in the “red”, SOUN is “speculative” currently.

(2) 2024 Outlook (and beyond).

  • For FY 2024, its forecast revenue is between $63 million & $77 million.

  • At midpoint, it will be nearly +53% growth, YoY.

  • For FY 2025, SOUN said it’s looking for revenue to exceed $100 million.

However, it is SoundHound AI’s $661 million in future revenue, awaiting to be collected, that is interesting!

  • These are subscriptions and bookings SOUN already have agreements for.

  • Most of the agreement’s money should come in by end 2031, with some contracts lasting even longer.

(3) SOUN’s backer.

  • Reportedly, AI-leader Nvidia owns approximately 3.7 million shares of SOUN (approx. 0.6% of the company).

  • In addition to Nvidia being a “backer”, it is also a partner-collaborator offering an innovative, generative-AI-enabled in-vehicle voice platform.

Anymore “doubts” about SoundHound AI Inc?

Must ReadClick on below titles to access. Give a like & help to Repost ok. Thanks.

  • Do you think that AI-application related stocks will boom in the aftermath?

  • Do you think SoundHound AI Inc will be a “leader” of its own; just like its backer Nvidia?

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# 💰 Stocks to watch today?(12 Apr)

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  • RachelEuphemia
    ·04-03
    TOP

    It’s hard to predict. AI stocks seem to hot to invest now

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    • JC888
      Hi, tks for reading my post... For SOUN, need to understand the product to know it's potentials and if it could lead.... Homework....
      04-03
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  • ToTheMils
    ·04-03
    TOP
    Thanks for sharing.. too volitile for my heart😫
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    • JC888
      Hi, tks for reading my post... Hahaha. Maybe watch for it, if it falls, claim a small stake... U never knw...
      04-03
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  • Taurus Pink
    ·04-03
    TOP
    [得意] [得意] [得意]
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    • JC888
      Hi, tks for reading my post...
      04-03
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  • Great article, would you like to share it?
    Reply
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    • JC888
      Hi, tks for reading my post....
      04-04
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  • 看起來他目前並不受市場的青睞,至少現在是如此。
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    • JC888
      Hi, tks for reading my post.. If it becomes the market darling, it will not be the current price range.. It is a little speculative...
      04-03
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  • Xiaogou819
    ·04-05

    Great article, would you like to share it?

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    • JC888
      Hi, tks for reading my post....
      04-05
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  • henghm
    ·04-05
    Great article, would you like to share it?
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    • JC888
      Hi, tks for reading my post...
      04-05
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  • Kelvink73
    ·04-04

    Let's see how she perform in the long run 

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    • JC888
      Agree.... Waiting for my right entry price too....
      04-04
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  • Sushil
    ·04-04
    Great article, would you like to share it?
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    • JC888
      Hi, tks for reading my post...
      04-04
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  • Sonsonkok
    ·04-04

    Great article, would you like to share it?

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    • JC888
      Hi, tks for reading my post...
      04-04
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  • Fenger1188
    ·04-02
    谢谢分享👍🏻
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    • JC888
      Hi, tks for reading my post and support....
      04-02
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  • JC888
    ·04-02
    Hi, tks for reading my post. I make time to write and share my post.
    Pls help to "Re-post". Tks! Rating is important (to me).
    Would you consider "Follow me" and get first hand read of my Daily new posts? Thanks!). Tks!
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  • Daveslor
    ·04-05

    Sharing this

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    • JC888
      Hi, tks for reading my post...
      04-05
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  • KSR
    ·04-03
    👍
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    • JC888
      Hi, tks for reading my post
      04-03
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  • Tom Chow
    ·04-03
    good
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    • JC888
      Hi, tks for reading my post...
      04-03
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