SoundHound AI (SOUN) Downgraded: What Investors Need to Know Now
'We are downgrading shares of SoundHound from OW to Neutral but reiterating our $12 price target.'
The firm noted that even though there is long-term potential for SoundHound, some deals may be pushed into 2026 for the company. The company is currently facing a challenge in trying to achieve profitability while also investing in its Amelia product line. Achieving both these goals effectively, the firm highlighted, can be a challenge for the company.
The firm is particularly concerned about how pressure on second-half estimates may negatively impact SoundHound's valuation multiple. Currently, it exceeds 20 times the calendar year 2026 estimates. Piper Sandler is constructive on the company's long-term opportunities regardless of the downgrade, but also acknowledges that execution in the second half of 2025 'could create a squeeze on shares.'
SoundHound AI, Inc. (NASDAQ:SOUN) is a voice artificial intelligence company offering voice AI solutions to businesses.
While we acknowledge the potential of SOUN as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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