Why SoundHound AI (SOUN) Crashed Last Week?

We recently published a list of These Were Last Week’s 10 Worst Performers. In this article, we are going to take a look at where SoundHound AI, Inc. (NASDAQ:SOUN) stands against other last week’s worst performers.

Ten companies posted double-digit declines last week amid a series of dismal earnings performance and outlook guidance that weighed down on investor sentiment, bucking an overall strength of Wall Street’s main indices on a week’s basis.

Over the past five trading days, the Dow Jones registered growth of 0.5 percent, the S&P 500 increased by 1.47 percent, and the tech-heavy Nasdaq rallied by 2.57 percent.

To come up with the list, we only considered the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.

A software engineer focused on a computer screen, writing code to create a conversational assistant.

SoundHound AI, Inc. (NASDAQ:SOUN)

SoundHound AI, Inc. (NASDAQ:SOUN) nosedived by 29.7 percent on Friday to $10.97 apiece from $15.6 registered on February 7, as investors took path from Nvidia Corp.’s reduced ownership positions in the company.

Last week, NVDA submitted a regulatory filing showing its stake positions in various firms. The filing showed a 44-percent reduction in its holdings in British chipmaker Arm Holdings while exiting Serve Robotics and SoundHound AI, Inc. (NASDAQ:SOUN).

An analyst from Triple D Trading was quoted as saying that there is no stronger vote of confidence than NVDA investing in a company.

NVDA’s divestment in SoundHound AI, Inc. (SOUN) has raised investor concern over the future of its growth trajectory, particularly as it was once seen as a promising player in the AI industry.

Overall, SOUN ranks 3rd on our list of last week’s worst performers. While we acknowledge the potential of SOUN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SOUN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.