Zacks.com has announced a list of stocks featured in its Analyst Blog for January 17, 2025. Among them is SoundHound AI, Inc. (SOUN), which has seen significant growth in recent years. In this article, we will analyze the reasons to be bullish on SOUN stock and explore whether it can become the next NVIDIA Corp.
SoundHound AI’s products are widely accepted by several industries, including generative AI models for drive-through ordering at quick-service restaurants like Chipotle Mexican Grill, Inc. The company’s voice AI systems have been adopted by electric vehicle manufacturers and auto brands, leading to impressive 89% revenue growth in the third quarter.
Management has increased revenue guidance to nearly $85 million for 2024 and nearly $175 million for 2025. However, SoundHound AI faces concerns due to its lofty valuations, trading at 35 times sales, resource constraints, recent operating losses, and reliance solely on equity financing.
Additionally, the company is facing competition from major players like Alphabet Inc., which has recently been selected by Mercedes-Benz for its CLA cars and other vehicles. Investors should adopt a wait-and-watch approach before placing bets on SOUN stock, considering whether SoundHound AI’s growth has been driven by fundamentals or inflated share prices.
For now, SOUN stock has a Zacks Rank #3 (Hold). To access the complete list of top stocks, visit Zacks.com.
Source: https://finance.yahoo.com/news/zacks-analyst-blog-nvidia-soundhound-065700022.html