Does Soundhound AI stock tickets to become a billionaire?
Sound Hound AI (NASDAQ: soun) It has become one of the hottest stocks on Wall Street, and has risen by around 170% since the beginning of November 2024. However, it rose nearly 400% by the end of December, making it well beyond the peak of the massive driving.
With Soundhound down more than 40% from an all-time high, many investors may wonder if this stock could be prepared for another large run . Some consider this stock as a ticket Become a billionaire.
So does this stock have the ability to do that? After all, another AI stock has already made millionaires for many investors.
To become a billionaire from one stock pick may seem like a huge dream for some people, but that’s completely possible. If you invest $10,000 nvidia (NASDAQ: NVDA) Unless you have stocked 10 years ago and you hold and sell, you’ll now have $2.55 million. Let’s take a look.
Soundhound AI software is about audio recognition and the use of its inputs in AI models. Most of the generator AI models we have interacted with so far use text input. However, users must have access to the keyboard to make this work. It’s not necessarily a practical application.
Some customers may prefer to speak with their voices (think drive-thru at a restaurant) or you need to research your AI assistant while driving (if your car is completely self-driving Do you also need a keyboard in your car?) This is where Soundhound technology comes in and has already won several big clients.
Soundhound’s software is already integrated Stellantis European and Japanese vehicles. This is a large auto brand, and if this technology becomes a hit, there is a very good chance that other automakers will also partner with Soundhound. Many restaurants have also partnered with Soundhound to deploy technology to integrate AI into drive-thru and online ordering.
This allowed Soundhound to develop a variety of revenue streams. There, the business sector (automobiles, restaurants, financial services, healthcare, insurance) does not account for more than 25% of the total. This is a significant improvement, as 72% of revenue came from one client in the automotive sector in the third quarter last year (probably Stellantis).
Soundhound also has a great desire for growth. It is expected that revenue will double in 2024 and again in 2025, with preliminary guidance coming in at $165 million ($83 million in 2024). It’s a huge growth and we’re also seeing great revenue growth beyond that.
The company’s booking backlog describes the values remaining on the current contract you signed. This does not guarantee revenue, but it gives investors the idea of how much growth they can expect in the future. Soundhound’s backlog currently exceeds $1 billion and has spread over a six-year period. That’s a strong expected revenue, and this backlog figure could rise as the technology’s use cases increase.
But is that enough to make you a billionaire?
First, you need to set the basic investment amount. I’ll use $10,000 because that’s what I used in the Nvidia example above. To convert $10,000 to $1 million, the stock needs to increase its value by 100 times. Currently, Soundhound is a $5.4 billion company. This means that if you achieve that feat, it will be valued at around $540 billion.
So, which companies are being evaluated at that threshold now? It would put the soundhound in the same evaluation range Mastercard ($515 billion) Oracle ($496 billion). This may be an unrealistic expectation as these are very dominant companies serving the world.
For further comparison, some of the largest software companies in the market today are Salesforce ($300 billion) Adobe ($199 billion). Soundhound’s current revenues look like a rounding error for these companies, even with strong 2025 growth built into them.
So, could Soundhound make you a billionaire from a $10,000 investment? Probably not. But that doesn’t mean it won’t be a good investment. It offers powerful products and tackles a critical niche in AI integration across society. It’s still growing as other companies can easily offer an audio recognition platform comparable to Soundhound’s rivals, but there are still many risks to stock.
Consider this before purchasing stock with Soundhound AI.
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Kisen Drury I have positions in Adobe, MasterCard, Nvidia, and Salesforce. Motley Fool has posted and recommended positions on Adobe, MasterCard, Nvidia, Oracle, and Salesforce. Motley’s Fool recommends Stellantis. To Motley’s fool Disclosure Policy.
