One effective method for surpassing the overall market’s growth is by investing in stocks that prioritize expansion. These dynamic companies have the potential to raise their revenues and profits at a quicker rate than the general market. This accelerated growth results in substantial increases in stock prices, ultimately enriching investors along the way.
If your aim is to outperform the overall market growth and you currently have only $15 available for investment, one option could be purchasing a single share of SoundHound AI (SOUN). This company, specializing in voice artificial intelligence solutions, has seen a decline of 35% this year so far. Currently, each share is trading below $15.
Let’s examine the factors making SoundHound an intelligent growth stock choice if you have only $15 to invest.
SoundHound AI is growing at a breathtaking pace
SoundHound’s AI voice platform empowers customers to create diverse applications including voice-controlled AI assistants, intelligent ordering systems for eateries, smart response systems, car-mounted AI chatbots, and tailored voice AI solutions. This rapidly expanding market segment was valued at approximately $3 billion last year, with predictions suggesting it could rake in a staggering $47.5 billion by 2034.
SoundHound AI is effectively carving out a significant niche for itself by developing a robust and varied clientele that spans industries like food services, travel, hospitality, automotive, healthcare, finance, and more. Notable clients in this mix include auto giants Stellantis and Hyundai, tech companies Qualcomm and Snap, as well as smart TV manufacturer Vizio, just to name a few. The list of SoundHound’s customers is quite extensive.
As a passionate advocate for SoundHound, I can’t help but marvel at the phenomenal growth we’ve witnessed ever since our initial public offering roughly three years back. Our expansive and diverse clientele is undoubtedly a key factor fueling this incredible expansion!
Significantly, SoundHound is making strategic moves to maintain its leading position in the voice AI market. It achieves this by purchasing other companies and launching innovative products. This approach has generated a steady income stream, which is expected to support continued robust growth over time.
In simple terms, by December 2024, it was noted that SoundHound had an accumulated subscription and booking backlog of a staggering $1.2 billion. This amount surpasses the projected total revenue for SoundHound over the current year and the following two years combined.
Absolutely, SoundHound clarifies that this metric represents “predicted future results based on different suppositions, which might or might not be accurate.” Yet, the current backlog appears substantial enough to drive strong growth in the future, even if not all prospective opportunities are converted into real income.
Furthermore, SoundHound’s management projects that their total potential market size amounts to a staggering $140 billion. Consequently, there is a strong possibility that their pending orders could expand further, given the ongoing expansion of the voice AI market. This growth might draw in new clients to their platform and persuade existing customers to invest more in their services.
This data suggests an increase in the pace of SoundHound AI’s expansion could be imminent. Yet, it may puzzle investors as to why SoundHound AI has suffered losses this year, given its impressive growth trajectory and promising future outlook.
Growth investors should look beyond valuation concerns
Last year, SoundHound’s stock significantly boosted investors’ riches. Consequently, its price-to-sales ratio escalated beyond 90 at the year’s end in 2024. However, turbulence in tech stocks earlier this year had a negative impact on SoundHound. With investors liquidating costly stocks to safeguard their capital due to stock market instability brought about by tariffs and conflicts, the company was affected.
SoundHound’s current valuation multiple stands at 46, which some may find pricey, but it’s crucial to consider that the company anticipates a nearly doubling of its revenue by 2025, according to the midpoint of its projected revenue range ($157-$167 million). Given SoundHound’s forecasted continued strong growth over the next two years, its future sales multiples are likely to be lower due to this anticipated robust expansion.
Investing in SoundHound AI could come with potential price fluctuations due to its high valuation, but the company’s remarkable expansion and vast market potential make it a savvy choice for growth investors. With an initial investment of only $15, you could benefit from SoundHound AI’s continued growth at above-average rates in the long term, given its ability to capitalize on its impressive growth trajectory and substantial market opportunity.
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2025-07-25 14:14