Why SoundHound AI's (SOUN) Amelia Acquisition Could Pay Off in the Long Run

SoundHound AI, Inc. (NASDAQ:SOUN) is one of the AI Stocks Analysts Are Watching Closely. On August 11, Ladenburg Thalmann analyst Glenn Mattson upgraded the stock from Neutral to Buy with a price target of $16.00 (from $9.00). The rating upgrade comes after Soundhound posted second-quarter revenue well above expectations driven by its large contract wins.

According to the firm, momentum in core verticals is helping offset previous concerns about low-margin contracts from the Amelia acquisition. These are anticipated to be phased out over the next 18 months.

The firm also believes that SoundHound is building a broader platform that may link automotive, restaurant and enterprise customers into a voice-enabled ecosystem. This will in turn create lead-generation revenue streams.

“We upgrade shares to Buy and raise our PT to $16 (from $9). We continue to view Voice as one of the key early applications for AI systems. The company is a leader in this space and is adding significant utility for enterprises looking to adopt AI functionality. The Amelia acquisition still needs further integration but is providing solid benefits in terms of scale, new lead generation, and an entry into the enterprise. While valuation remains elevated, the growth and scale justify that premium, in our view. We now use a 22x multiple on our new 2027 estimate to achieve our $16 PT. This is justified by the rule of 40 peer set found in the body of the report.”

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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Disclosure: None.