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Is SoundHound AI Inc (NASDAQ:SOUN) the Best Cheap AI Stock After Latest Acquisitions?

We recently published a list of 11 Trending AI Stocks On Latest News and Analyst Ratings. Since SoundHound AI Inc (NASDAQ:SOUN) ranks 11th on the list, it deserves a deeper look.

Investors remain cautious following a major global selloff that shook the markets last week on recession fears. Analyst warnings around sky-high CapEx of tech companies and lack of visibility over returns are also expected to keep tech valuations in check in the coming weeks.

Last month, Roger McNamee of Elevation Partners, while talking to CNBC, highlighted a report from Goldman Sachs that said returns of AI investments might fail to meet investors’ expectations.

“The amount of capital investment in this sector, which is billions of dollars now, is so large that it’s almost unimaginable that we are going to get a rate of return over the next few years that justifies the amount of investment,”  McNamee said.

Talking to Bloomberg, JPMorgan Asset Management’s Aisa Ogoshi said that there is some “adjustment” coming for tech stocks as she expects the AI-centric rally to diversify to other sectors.

“The key is to keep an eye on the earnings trends. It’s easy to  panic in these times but really, just sit down and look at the numbers and reassess our positioning.”

Asked whether she plans to reduce exposure to AI stocks in the coming days, the analyst said she’d be more “selective” when it comes to AI plays and will increase the quality of stocks in the portfolio.

For this article, we chose 11 trending AI stocks based on the latest news, earnings and analyst ratings. With each stock we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

SoundHound AI Inc (NASDAQ:SOUN)

Number of Hedge Fund Investors: 15

SoundHound AI Inc (NASDAQ:SOUN) recently announced it will buy AI startup Amelia AI for $80 million. Amelia makes an AI agent that businesses that customize according to their needs. The company’s customers include BNP Paribas, the pharma company Teva and Fujitsu.  With 2024 revenue projected at $80M, SoundHound AI Inc (NASDAQ:SOUN) now expects 2025 revenue to surpass $150M, with Amelia contributing $45M in recurring AI software revenue and related fees.

SoundHound AI Inc (NASDAQ:SOUN) is expanding its solutions arsenal to increase its business footprint. In June the company bought Allset, an ordering platform for restaurants. Last year, it bought SYNQ3, which provides conversational AI-ordering solutions for restaurants, for $25 million.

Cantor Fitzgerald upgraded SoundHound AI to Overweight from Neutral on the Amelia deal news. Analyst Brett Knoblauch called the deal potentially transformative and increased his price target for SoundHound to $7 from $5.

SoundHound AI Inc (NASDAQ:SOUN) AI has strong secular growth catalysts because businesses all over the world are deploying voice AI solutions to cut costs and improve efficiency. During an earnings call in May SoundHound AI Inc (NASDAQ:SOUN) talked about the potential of its AI solutions business potential for customer service:

Last year, we expanded our AI customer service offering beyond restaurants with Smart Answering, a product that handles multiple calls at once 24/7, conveniently filtering out spam calls, providing verbal and SMS responses, taking configurable actions, capturing leads with intelligent messaging and answering questions about policies, hours, products, services, pricing and more. Smart Answering is showing rapid growth within pillar two and already has hundreds of locations signed up from single-location small businesses to brands such as Planet Fitness. We estimate our pillar two (AI customer solutions service business) total addressable market to be over $100 billion with over 1 million restaurants and approximately 30 million businesses in North America alone that we can offer our solutions to. And with dozens of languages we already provide to our pillar one customers, we plan to also go international in pillartwo. We believe with large language models and generative AI and most importantly,the data science and machine learning behind our proprietary software, the time is now.

Overall, SoundHound AI Inc (NASDAQ:SOUN) ranks 11th on Insider Monkey’s list titled 11 Trending AI Stocks On Latest News and Analyst Ratings. While we acknowledge the potential of SoundHound AI Inc (NASDAQ:SOUN), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SOUN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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