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Yahoo
15 minutes ago
- Yahoo
Could Buying SoundHound AI Stock Today Set You Up for Life?
Key Points SoundHound AI's voice AI products have attracted a considerable client base, particularly in the auto industry. The company's triple-digit revenue growth has likely helped it draw interest from investors. Beyond revenue, its financials and valuation could cause concern for SoundHound stock bulls. 10 stocks we like better than SoundHound AI › At first glance, investors might wonder whether SoundHound AI (NASDAQ: SOUN) stock could set them up for life. Its recent $5.1 billion market cap is close enough to the ground floor that the company might have a tremendous runway for expansion. Moreover, its high-profile client base could reinforce the company's stability and growth. Still, such advantages may not be sufficient to make SoundHound stock one of the great growth stories of the next decade. Investors need to take a closer look at the business and financials before drawing such a conclusion. Making sense of SoundHound AI Founded in 2005, SoundHound initially attracted attention with a music recognition app that gained popularity early in the last decade. Soon after, it began building relationships with automobile manufacturers, including Hyundai Motor and Mercedes-Benz, that had taken an interest in its voice AI platform. However, much of its more recent success comes from its SoundHound Chat AI product, which utilizes generative AI to provide a more conversational experience for users interacting with chatbots. It is easy to understand why SoundHound wants to capitalize. Grand View Research forecasts a compound annual growth rate of 30% between 2024 and 2030, taking the industry size from $3.5 billion in 2024 to an estimated $21.8 billion by 2030. Amid its success, SoundHound AI went public in April 2022. Indeed, its stock price initially dropped following the 2022 bear market but has been on an upward trajectory since early 2024. If you had bought shares on its first day after a special purpose acquisition company (SPAC) bought it, you would have earned returns of just over 70% during the stock's history. What the financials say about SoundHound's potential At first glance, the financials point to potential. In the first quarter of 2025, revenue of $29 million increased by 151% from year-ago levels. This was an improvement over the 84% increase in 2024. Still, the rest of the income statement might foster doubts about the company. In Q1, total operating expenses were a negative $99 million, though a $176 million change in fair value of contingent acquisition liabilities temporarily boosted its financials. If not for that one-time benefit, operating expenses would have been $77 million, far above its revenue. That would have also translated into a substantial increase over its operating loss in Q1. In Q1, SoundHound reaffirmed its 2025 revenue estimate of between $157 million and $177 million. Still, even though that would amount to a 97% revenue increase at the midpoint, operating expenses were $203 million, not including a $223 million change in fair value of contingent acquisition liabilities in 2024. If operating expenses also rise 97%, SoundHound is looking at another year of massive losses. As of Q1, SoundHound had about $245 million in liquidity. However, continuing losses may force it to either take on debt or issue more shares, likely affecting shareholders negatively. The aforementioned one-time benefit presumably gives SoundHound a P/E ratio, but that same benefit makes it a misleading valuation indicator. Although you can turn to the price-to-sales (P/S) ratio, the 46 sales multiple is much higher than the S&P 500 average of 3.2, indicating the stock price is far ahead of the company's revenue levels. Can buying SoundHound AI stock today set you up for life? Considering the state of SoundHound stock, it has more to prove before investors can feel confident it will set them up for life. Admittedly, SoundHound's technology and its popularity have shown enough promise to drive triple-digit revenue growth. Since the company has only captured a tiny portion of the industry's estimated growth, the rapid increases could continue for the foreseeable future. Unfortunately, its operating expenses outpace revenue by a wide margin, indicating profitability will take years, if it reaches that point at all. Moreover, a 46 P/S ratio means that its valuation is significantly ahead of its growth, which could limit future stock price increases and raise the likelihood of a substantial pullback. Ultimately, SoundHound has positioned its business for a bright future. Nonetheless, until the company can forge a path to profitability, investors are likely best served by staying on the sidelines. Should you invest $1,000 in SoundHound AI right now? Before you buy stock in SoundHound AI, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and SoundHound AI wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $634,627!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,046,799!* Now, it's worth noting Stock Advisor's total average return is 1,037% — a market-crushing outperformance compared to 182% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Will Healy has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Could Buying SoundHound AI Stock Today Set You Up for Life? was originally published by The Motley Fool
Yahoo
25 minutes ago
- Yahoo
‘His income is limited': Should I pay $800 a month towards my husband's $67,000 student debt?
My husband is 40 and I am 44. When we got married a year ago, I was aware that he had about $67,000 in student-loan debt as well as credit-card debt from living paycheck-to-paycheck. He never consolidated his student loans and they all have varying interest rates between 5% to 8%. I did not have him consolidate the loans as there were potential benefits under the Biden administration for him not doing so. In the meantime, I was able to get him to change his spending habits and pay off all his credit cards by helping him understand the principles behind how interest and payments work. He also has his own business, which has a small financial footprint supported by his income. As for myself, my income allowed me to purchase a house in 2020 with a 2.6% interest rate. I am able to pay all the bills to support us both and then some. Wall Street braces for deluge of Treasury bills, a crucial test of market demand Why Tesla analysts are mostly upbeat about earnings, but investors aren't happy 'If I was writing the checks at Coke, I wouldn't write the check for this,' one expert says about cane-sugar Coke Related: The 5 huge changes coming for student-loan borrowers and colleges under GOP megabill I have stopped short of paying for his business, his car payment and health insurance. Yes, there are a few incidentals he also helps support for our family, such as food, but his income is limited due to his new business and part-time work. I would like to grow my retirement and emergency funds some more, but I am very aware of my husband's student-loan debt, which he is not paying down in a timely manner. I graduated with about $57,000 worth of student loans in the early 2000s. A modest lifestyle on an income that rarely topped $15 per hour and low rent helped me pay off my own student-loan debt in 10 years. I have been working for the same company for over 15 years and I have built a career path that has led me to making almost six figures annually. I have an estimated retirement income of about $6,500 per month. I believe I can contribute about $800 per month to paying off my husband's student-loan debt. From what I understand, I am not legally responsible for his student debt, which was all taken out by him before we were married. We also keep our bank accounts separate so that if something should happen where the government lands on student loans, my income is in no way touched and all the normal bills could be paid like normal. Am I better off paying toward my husband's student-loan payments, or should I take this monthly amount and invest it elsewhere? Thank you for your kind attention. Student Loans Are Killing Us All Don't miss: 'Why am I so afraid to retire?' I'm 60 and lost $1.2 million in a divorce. Can I rebuild my life? I have a funny feeling you're going to do what you're going to do. But since you asked… You married this man, who may be a wonderful guy, and appear to be paying the lion's share of the bills. You are now considering crossing that imaginary line and helping him pay off other extraneous expenses, and are now giving serious consideration to paying off his student debt. Paying your husband's bills won't teach him to make smarter financial decisions in the future, nor will it help you in your own retirement goals. The fact that he would actually accept $800 a month from you to pay off his student debt also gives me pause. It tells me: He ain't gonna change his financial habits. You are not responsible for these loans, as I'm sure you are aware, given that they were taken out before your marriage. So I wonder why you have the 'disease to please' or, in this context, the 'fret about his debt,' and see it as much your obligation to pay off as his. Why do you see his debts as your duty to pay? You don't have to pay his bills. You don't have to make up the shortfall because his business is not performing. You don't have to take money from your own retirement fund in order to pay off his student loan because he didn't do what you did —live far below your means and work a $15-an-hour job. You didn't clear your own loan so you would have the time/money to clear his debts. If you paid off this loan solo — let's say your husband became overwhelmed with other expenses, which would not be so farfetched given his current and previous financial situation — it would take you more than 10 years and end up costing you nearly $100,000, including roughly $33,000 in interest. If you and he paid $800 each, it would take half that time (five years) and cost just over $76,000, including $9,000 interest. Related: My husband and I are 40. I have $200,000 in student debt, while he has $600,000 in retirement savings. Are we in trouble? It's important to see what you are giving up by paying your husband's debts: Let's say you invested $800 a month in the S&P 500 SPX for 10 years and 4 months — the same amount of time it would take you to pay off his student loan alone. At an average annual return of 7%, compounded monthly, you would end up with $138,000 for your retirement and/or emergency fund by the time you're 54. Nice work, if you can get it. If you do the math, it makes more sense for you to invest that $800 and tell your husband that he should put together a plan to pay his student loan just like you did. If you don't pay his student loans, it doesn't mean that you don't love him. It doesn't make you a bad person or an uncaring or unsympathetic partner. It does make you somebody who values their own financial independence and intends to lead by example. Let me share a story with you that I have not thought about in many years. When I was a kid, I had a paper route. It was, you might say, my first job in journalism. I finished school early on a Wednesday afternoon and I delivered newspapers for exactly one penny per paper. It sounds like I grew up in Dickensian times, but it was Ireland before the economic boom. It was my first taste of earning my own money and it felt bloody great. One week, I finished my paper route shortly after lunch and my friend who lived on my street neglected to do his route until late in the day, so I suggested helping him. It never occurred to me to ask for money and, if he did offer, I refused. Either way, I arrived home empty handed feeling pretty good about my good deed. My mother went through me for a short cut. She told me I should not have done half of his route in addition to my own. That's a roundabout way of saying: Allow your husband to deliver his own newspapers. Related: My daughter has $500K in med-school expenses. Can my wife and I afford to pay it off? My daughter has $500K in med-school expenses. Can my wife and I afford to pay it off? Can my husband contest his late brother's $600K will? He experienced oxygen deprivation due to COPD before he died. I have early Alzheimer's and my husband has stage 4 kidney disease. We just inherited $50K. How can this help us? . 'I'm already up $45,000 in about an hour' — Reddit traders boast about wins as meme-stock mania returns Dow cuts dividend in half in reaction to 'lower-for-longer' earnings The S&P 500 just did something it's only done four times in 50 years. Here's what happened next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
42 minutes ago
- Yahoo
Is Meta Platforms (META) The Best AI Stock to Buy on the Dip?
Meta Platforms Inc (NASDAQ:META) is one of the . Lucas Downey from MoneyFlows said in a latest program on Schwab Network that Meta Platforms is one of the top stocks to buy on any pullback. 'A great case in point would be Meta Platforms Inc (NASDAQ:META). This is a name that I've owned for a number of years. First thing is you got to think big themes, right? What is actually working? AI. Meta Platforms Inc (NASDAQ:META) has all this data and they continue to just grow their earnings. What was interesting about Meta is their last time that they had earnings. This is back in April. Just remember how worried the whole world was about earnings. They basically were saying that they were going to guide even higher. Their capex was going to go above and beyond what people were expecting. You can see analysts have been very bullish on this name. So, this would be the type of company that you would want to be looking for on any type of pullback.' Photo by austin-distel on Unsplash Meta Platforms (NASDAQ:META) is driving usage and ads revenue by improving its algorithms and user experience thanks to AI. Meta Platforms (NASDAQ:META)'s advancements in Reels and WhatsApp are helping manage CapEx growth as the company strives to stay competitive in AI. Meta Platforms (NASDAQ:META)'s substantial user base of 3.3 billion provides a data and distribution edge that could capture a significant share of the GenAI market. Meta Platforms can see huge progress related to AI as CEO Zuckerberg is aggressively spending on the technology and hiring top talent to achieve breakthroughs via the Superintelligence Labs team. He recently said his company plans to invest hundreds of billions of dollars on AI infrastructure. The company plans to build a massive 1+ gigawatt supercluster by next year. Mark Zuckerberg's commitment to AI could make it a key focus in the upcoming earnings call and potentially act as a major catalyst for the stock. Wedgewood Partners stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its second quarter 2025 investor letter: 'Meta Platforms, Inc. (NASDAQ:META) was once again a leading contributor to performance for the quarter – and our best portfolio performer since the panic-selling lows in the stock back in September of 2022. Revenue grew +16% despite ad-spending headwinds related to trade protectionism, and operating margins expanded thanks to continued investments in automation, driving a stellar +37% growth in earnings per share. The Company has been a consistent beneficiary of artificial intelligence (AI) over the past several years, investing aggressively in deep learning recommendation systems that help power it's products which reach nearly half the population of the planet. Meta's AI investments, combined with its massive scale, allow the Company to quickly spin up new products across its digital advertising real estate to reinforce its competitive positioning. Meta's core Family of Apps products are backed by extremely large and complex (i.e. difficult to copy) AI recommendation systems that have to sort through billions of datapoints in real time and come up with the probability of a user clicking on something. Meta is one of the few companies that has been able to consistently and, most critically, profitably monetize AI technologies for shareholders, and we continue to hold the stock as a top position in portfolios.' While we acknowledge the potential of META as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the . READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
