On Thursday, DA Davidson reaffirmed its confidence in SoundHound AI Inc. (NASDAQ: NASDAQ:SOUN), raising the stock's price target from $7.50 to $9.50 while maintaining a Buy rating. The firm's decision follows a series of in-person investor meetings with the company's top executives earlier in the week.
During these meetings with SoundHound's CEO, Keyvan Mohajer, and Head of Investor Relations, Scott Smith, DA Davidson gained insights into the company's technological edge and the extensive opportunities in the AI customer service sector. The discussions provided a clearer view of SoundHound's competitive advantages and the robustness of its updated backlog.
The analyst from DA Davidson highlighted the strength of SoundHound's position, noting, "We came away with greater clarity on the competitive moat of SoundHound's technology & the magnitude of the AI customer service opportunity."
Acknowledging the company's growth trajectory, the analyst added, "We also gained a better understanding on the strength of SoundHound's updated backlog." The new price target reflects an approximate 16-fold multiple on the company's projected calendar year 2026 revenues, which positions SoundHound as the fastest growing software company within DA Davidson's coverage.
The endorsement from DA Davidson underscores the potential that SoundHound AI Inc. holds in the rapidly evolving AI space, particularly in customer service applications. With the raised price target and sustained Buy rating, the firm signals its belief in the company's future performance and market position.
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