A Wall Street Analyst Sees SoundHound AI Shares Going Up 19 Percent

SoundHound AI (NASDAQ resonance code: SOUN)Up about 1,78% in 2024 trading, it's one of the most explosive artificial intelligence (AI) stocks of the year. In fact, the only notable companies in the space that have risen even more areSuper Micro Computer), its stock price rose about 2,55% in the first quarter of the year.

While SoundHound AI stock has already posted incredible gains in a very short period of time, at least one analyst thinks it's on track to go even higher in the near term. Ladenburg analyst Glenn Matson reiterated a Buy rating on SoundHound in a March 26 report, setting his price target at $7 per share. The stock closed the first quarter of 2024 at $5.89 per share, which implies an additional upside of about 19%.

Is SoundHound AI stock worth buying?

Matson expects SoundHound to grow sales at an annualized rate of 50% over the next two years and to achieve EBITDA profitability in the second half of 2025. The analyst believes that the company's voice-based artificial intelligence platform will continue to see strong adoption among enterprise customers, and points to the growth momentum of the company's Pillar II software for previewing曏 as a bullish indicator.

SoundHound could reach Matson's near-term price target of $7 per share, but I think long-term investors should proceed with caution. Shares of the audio technology specialist are currently trading at about 26.2 times this year's expected sales, and the earnings outlook is uncertain.

Meanwhile, Supermicro's sales are growing rapidly, at about 3.9 times this year's expected sales and 46 times expected earnings. For AI investors, I think Supermicro stock is a better buy than SoundHound.

Should you invest $1,000 in SoundHound AI right now?

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Keith Noonan does not hold any of the shares listed above.The Motley Fool does not hold any of the shares listed above.The Motley Fool has a disclosure policy.

SoundHound AI Stock Is Headed High Up, According to 1 Wall Street Analyst 19% was originally published by The Motley Fool.