Nitesh Sharan, CFO of SoundHound AI (SOUN), sold shares worth $1.28 million of the voice-AI company on October 14 as part of a prearranged 10b5-1 trading plan adopted in December 2024. SOUN stock was down over 8% during Friday’s regular trading session.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
According to the SEC filing, Sharan sold 60,376 shares at $21.21 per share. It is worth noting that 30,000 of these shares were obtained by exercising stock options at $7.514 per share.
It is worth noting that a corporate insider’s stock sale does not always signal caution about the company’s future potential. They may sell shares for several reasons, including financial or personal obligations.
Further, Rule 10b5-1 plans let company insiders sell stock without using secret information. The trades happen automatically when set conditions like price, volume, or timing are met.
Bearish Insider Sentiment for SOUN Stock
It must be noted that Sharan is not the only insider who reduced their stake in the company. Based on other informative insider transactions from the last three months, corporate insiders have sold $5.3 million worth of SoundHound AI stock.
Overall, TipRanks’ Insider Trading Activity Tool shows that insider confidence in the stock is currently Very Negative.
Investors may benefit from keeping an eye on transactions made by key insiders, as these transactions typically reflect their confidence in the company’s prospects. Interestingly, TipRanks offers daily insider transactions as well as a list of top corporate insiders. It also provides a list of hot stocks that boast either a Very Positive or Positive insider confidence signal.
SOUN Stock Rises 154% in Six Months
It is worth noting that insider sales come after SoundHound AI stock has risen about 154% in the past six months. Investors are optimistic about the company’s strong financial performance and rising demand for its Amelia 7 platform.
Recently, H.C. Wainwright analyst Scott Buck raised his price target from $18 to a new Street-high of $26. The analyst sees strong gains ahead, with the Q3 results in November serving as a potential catalyst.
What Is the Price Target for SOUN Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SOUN stock based on five Buys and three Holds assigned in the past three months. Further, the average SoundHound AI price target of $16.57 per share implies 12.88% downside risk.
