SoundHound AI Maintains Buy Rating Amid Revenue Growth and Strategic Partnerships

SoundHound AI stock holds Buy rating on revenue growth strategy By Investing.com

On Wednesday, H.C. Wainwright maintained a positive stance on SoundHound AI Inc. (NASDAQ: NASDAQ:SOUN) shares, reiterating a Buy rating and a $7.00 price target. Following a recent meeting with the company's management at the 26th Annual H.C. Wainwright Investment Conference in New York, the firm expressed confidence in SoundHound AI's strategy for revenue growth and cost management, anticipating a move towards operating profitability over time. SoundHound AI has reported a significant increase in its cumulative subscriptions and bookings backlog, reaching $723.0M as of June 2024, which is about twice the amount from the previous year. This growth is seen as a strong indicator for achieving the company's revenue targets of $80.0M for 2024 and $150.0M for 2025. These targets include contributions from organic growth opportunities and recent mergers and acquisitions. While acknowledging that recent acquisitions might delay full-year profitability until possibly 2026 or 2027, H.C. Wainwright expects investors to witness steady progress towards operating break-even. The firm anticipates benefits from improved gross margins and scaling revenue. H.C. Wainwright highlights the potential market opportunity for conversational AI and SoundHound AI's robust financial position, suggesting that trading near-term profitability for long-term market share is a favorable strategy. The company's recent mergers and acquisitions, such as those with SYNQ3 and Amelia AI, have positioned SoundHound AI as a leader in the conversational AI space and have enhanced its competitive edge. H.C. Wainwright advises investors to continue accumulating SoundHound AI shares in anticipation of improving operating results, standing firm on a Buy rating with a $7 price target. In other recent news, SoundHound AI, Inc. has reported a substantial rise in earnings and revenues, marking a 54% increase in the second quarter of 2024 to reach a total of $13.5 million. The company has also made strategic acquisitions, including conversational AI leader Amelia and ordering platform Allset. These acquisitions, aimed at enhancing customer service capabilities and creating a voice commerce ecosystem, are projected to positively impact earnings in the latter half of 2025. SoundHound's backlog of subscriptions and bookings has notably doubled year-over-year, reaching $723 million. This indicates a strong demand for its services, particularly the Polaris (NYSE:PII) model, which is gaining traction across various sectors, including the automotive industry, as evidenced by new contracts from leading electric vehicle manufacturers. MUSC Health, in collaboration with SoundHound, has launched an AI-powered agent named Emily to streamline patient appointment management. The introduction of Emily is expected to enhance patient satisfaction and improve operational efficiency at MUSC Health. These are among the recent developments that highlight SoundHound's commitment to innovation in the voice AI market. As SoundHound AI Inc. (NASDAQ: SOUN) navigates its path toward profitability, real-time metrics from InvestingPro offer a snapshot of the company's financial health and market performance. With a market capitalization of $1.72 billion, SoundHound AI holds more cash than debt on its balance sheet, which is a positive sign of financial stability. This aligns with H.C. Wainwright's confidence in the company's robust financial position and strategic revenue growth. InvestingPro Tips highlight that analysts anticipate sales growth in the current year, which supports the firm's optimistic revenue targets for SoundHound AI. However, they also note that the company is not expected to be profitable this year and has experienced significant stock price volatility. The company's stock price has seen a strong return over the last year, with a 113.33% increase, yet it has taken a hit over the last six months with a 41.75% decline. This suggests that while investors may be rewarded in the long term, they should be prepared for potential short-term fluctuations. Prospective and current investors can find additional insights, with over 10 InvestingPro Tips available at https://www.investing.com/pro/SOUN, offering further guidance on SoundHound AI's financial metrics and market trends. These tips can help investors make informed decisions aligned with their investment strategies and risk tolerance.

Breaking Down SoundHound AI: 6 Analysts Share Their Views - SoundHound AI (NASDAQ:SOUN)

SoundHound AI SOUN underwent analysis by 6 analysts in the last quarter, revealing a spectrum of viewpoints from bullish to bearish. The following table provides a quick overview of their recent ratings, highlighting the changing sentiments over the past 30 days and comparing them to the preceding months. Bullish Somewhat Bullish Indifferent Somewhat Bearish Bearish Total Ratings 3 2 1 0 0 Last 30D 1 0 0 0 0 1M Ago 0 0 0 0 0 2M Ago 2 2 1 0 0 3M Ago 0 0 0 0 0 Insights from analysts' 12-month price targets are revealed, presenting an average target of $7.17, a high estimate of $9.00, and a low estimate of $6.00. Observing a 6.22% increase, the current average has risen from the previous average price target of $6.75. Breaking Down Analyst Ratings: A Detailed Examination The standing of SoundHound AI among financial experts becomes clear with a thorough analysis of recent analyst actions. The summary below outlines key analysts, their recent evaluations, and adjustments to ratings and price targets. Analyst Analyst Firm Action Taken Rating Current Price Target Prior Price Target Scott Buck HC Wainwright & Co. Maintains Buy $7.00 $7.00 Scott Buck HC Wainwright & Co. Maintains Buy $7.00 $7.00 Michael Latimore Northland Capital Markets Raises Market Perform $6.00 $5.50 Brett Knoblauch Cantor Fitzgerald Raises Overweight $7.00 $5.00 Daniel Ives Wedbush Maintains Outperform $9.00 $9.00 Scott Buck HC Wainwright & Co. Maintains Buy $7.00 $7.00 Key Insights: Action Taken: Analysts adapt their recommendations to changing market conditions and company performance. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their response to recent developments related to SoundHound AI. This information provides a snapshot of how analysts perceive the current state of the company. Rating: Offering insights into predictions, analysts assign qualitative values, from 'Outperform' to 'Underperform'. These ratings convey expectations for the relative performance of SoundHound AI compared to the broader market. Price Targets: Analysts set price targets as an estimate of a stock's future value. Comparing the current and prior price targets provides insight into how analysts' expectations have changed over time. This information can be valuable for investors seeking to understand consensus views on the stock's potential future performance. Considering these analyst evaluations in conjunction with other financial indicators can offer a comprehensive understanding of SoundHound AI's market position. Stay informed and make well-informed decisions with our Ratings Table. Stay up to date on SoundHound AI analyst ratings. If you are interested in following small-cap stock news and performance you can start by tracking it here. Get to Know SoundHound AI Better SoundHound AI Inc is an innovator of conversational intelligence, offering an independent Voice AI platform that enables businesses across industries to deliver high-quality conversational experiences to customers. SoundHound AI: Delving into Financials Market Capitalization Analysis: The company exhibits a lower market capitalization profile, positioning itself below industry averages. This suggests a smaller scale relative to peers. Revenue Growth: SoundHound AI displayed positive results in 3 months. As of 30 June, 2024, the company achieved a solid revenue growth rate of approximately 53.83%. This indicates a notable increase in the company's top-line earnings. In comparison to its industry peers, the company stands out with a growth rate higher than the average among peers in the Information Technology sector. Net Margin: SoundHound AI's net margin falls below industry averages, indicating challenges in achieving strong profitability. With a net margin of -277.78%, the company may face hurdles in effective cost management. Return on Equity (ROE): SoundHound AI's ROE is below industry standards, pointing towards difficulties in efficiently utilizing equity capital. With an ROE of -19.82%, the company may encounter challenges in delivering satisfactory returns for shareholders. Return on Assets (ROA): SoundHound AI's ROA is below industry standards, pointing towards difficulties in efficiently utilizing assets. With an ROA of -13.5%, the company may encounter challenges in delivering satisfactory returns from its assets. Debt Management: SoundHound AI's debt-to-equity ratio is below the industry average at 0.02, reflecting a lower dependency on debt financing and a more conservative financial approach. What Are Analyst Ratings? Analyst ratings serve as essential indicators of stock performance, provided by experts in banking and financial systems. These specialists diligently analyze company financial statements, participate in conference calls, and engage with insiders to generate quarterly ratings for individual stocks. Beyond their standard evaluations, some analysts contribute predictions for metrics like growth estimates, earnings, and revenue, furnishing investors with additional guidance. Users of analyst ratings should be mindful that this specialized advice is shaped by human perspectives and may be subject to variability. This article was generated by Benzinga's automated content engine and reviewed by an editor. Market News and Data brought to you by Benzinga APIs