Soundhound AI has announced the acquisition of Interaction, a company dedicated to AI-powered customer service tools, for $60 million in cash. Analyst Gil Luria from Da Davidson responded positively to the news, raising his stock price target for Soundhound from $15 to $17 while keeping a purchase rating.
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For some background, Soundhound AI specializes in speech recognition and natural language processing, delivering AI-driven solutions across various sectors.
Soundhound AI extends the AI edge
This acquisition is expected to enhance Soundhound’s position in Agent AI and broaden its reach in enterprise customer service. The deal could potentially add significant brands to their customer portfolio, including names from high-tech, insurance, automotive sectors, and other Fortune 100 companies.
The $60 million deal is anticipated to positively impact operating profits soon, along with additional payments linked to revenue milestones. Post-acquisition, the company will have over $270 million in cash without any liabilities.
Soun’s acquisition nods to analysts
Luria from Davidson sees this acquisition as a means to attract major new clients and enhance margins in the near future. He suggests that the deal will solidify Soundhound’s dominance in the AI-powered voice assistant market, particularly in the enterprise area where established relationships exist.
Luria’s revised price target of $17 signals a nearly 15% increase from current levels.
What is Soun’s price target?
According to Tipranks, Soun Stock has gained a strong consensus rating for purchases, with five buy ratings and one hold in the last three months. The average stock price target for Soundhound stands at $15.33, indicating a potential upside of 3.23% from where it currently is.
