SoundHound AI Stock Plummets: Is This Your Buying Opportunity?

SoundHound AI shares are taking a brutal beating today—down double-digits as the AI hype train hits another speed bump.

What's Driving the Carnage?

The voice recognition specialist got caught in the broader tech selloff, with investors fleeing speculative AI plays amid rising rate fears. SoundHound's volatility isn't new—this stock moves like a crypto asset without the fun memes.

Buying the Dip or Catching a Falling Knife?

Analysts remain divided. Bulls point to the company's patented voice AI tech and automotive partnerships as long-term value drivers. Bears counter that the path to profitability remains murky at best—another classic story stock burning cash while promising future glory.

Bottom line: SoundHound's plunge offers either a prime entry point or a masterclass in how not to chase falling tech stocks. Your move depends entirely on whether you believe voice AI will be the next big thing—or just another line item in some fund manager's 'learning experience' spreadsheet.

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Home Depot is the U.S.'s leading retailer in a category that is also directly adjacent to the broader real estate market, and investors and analysts often look to the company's business results and guidance as a broader macroeconomic indicator. With the company saying that it plans to raise prices, investors are worried that a recent acceleration for inflation among wholesalers is poised to trickle down to the consumer economy. If that winds up being the case, it could create a much tougher environment for growth-dependent tech stocks.

Is SoundHound AI stock a buy right now?

With SoundHound AI trading at roughly 30 times this year's expected earnings and still not posting profits, the company's valuation has a high level of sensitivity to unfavorable macroeconomic developments. After the Producer Price Index (PPI) report published by the Bureau of Labor Statistics (BLS) showed inflation at the wholesaler level that came in way above forecasts, Home Depot's announcement of pricing increases is intensifying fears that consumer-level inflation and overall inflation in the U.S. are poised for significant upticks that could cause the Federal Reserve to adopt a slower schedule for interest rate reductions.

In general, I think that the recent reads on inflation pose substantial near-term risks to highly growth-dependent tech stocks and other speculative plays. Along those lines, SoundHound AI stock could face more big sell-offs if unfavorable inflationary indicators continue to mount.

On the other hand, SoundHound AI has been posting very impressive sales growth momentum and appears to have a huge runway for long-term expansion. Given its strong sales expansion and category-leading tech offerings, I think the company stands out as a better buy than many other speculative AI plays -- and pullbacks could be worthwhile buying opportunities for risk-tolerant investors.