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SoundThinking Inc (SSTI)
NASDAQ:SSTI
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SoundThinking Inc
(NASDAQ:SSTI)
67Neutral
Positive Factors
International Expansion
The recently announced multi-year contract for the City of Niteroi indicates strong international momentum.
Legislation
California recently passed Assembly Bill 2975, which mandates hospitals to deploy weapons detection systems at all public entrances, implying a roughly $80 million TAM in California.
Negative Factors
Contract Renewal
The Chicago contract was not renewed, so respective revenue is now zero going forward.
Financial Performance
SoundThinking shares traded down 8% after the company reported mixed first-quarter results and lowered adjusted EBITDA margin guidance.
SoundThinking Inc (SSTI) vs. S&P 500 (SPY)
Market Cap
$196.56M
Dividend YieldN/A
Average Volume (3M)48.14K
Price to Earnings (P/E)―
Beta (1Y)1.24
Revenue Growth7.65%
EPS Growth-96.35%
CountryUS
Employees316
SectorTechnology
Sector Strength76
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.12
Shares Outstanding12,673,100
10 Day Avg. Volume48,995
30 Day Avg. Volume48,136
Financial Highlights & Ratios
PEG Ratio-1.66
Price to Book (P/B)2.66
Price to Sales (P/S)0.00
P/FCF Ratio16.35
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue0.46
Enterprise Value/Gross Profit3.17
Enterprise Value/Ebitda12.59
Forecast
1Y Price Target
$22.60Price Target Upside45.71% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
SoundThinking Inc Business Overview & Revenue Model
Company DescriptionShotSpotter, Inc. provides precision-policing and security solutions for law enforcement and security personnel in the United States, South Africa, and the Bahamas. Its solutions include ShotSpotter Respond, a public safety solution, which serves cities and municipalities to identify, locate, and deter gun violence by incorporating a real-time gunshot detection system into their policing systems; and ShotSpotter Connect, a patrol management software to help plan directed patrols and tactics to deter a broad set of crime types. The company also provides ShotSpotter SecureCampus and ShotSpotter SiteSecure that helps the law enforcement and security personnel serving universities, corporate campuses, big-box retail, malls, and key infrastructure or transportation centers to mitigate risk and enhance security by notifying authorities of a outdoor gunfire incident and saving minutes for first responders to arrive. In addition, it offers ShotSpotter Investigate, a cloud-based investigative platform to help law enforcement agencies modernize every phase of an investigation and accelerate case work with easy-to-use software tools. Further, it provides ShotSpotter Labs, a technology to adapt and extend commercial technology to address significant wildlife and environmental issues. The company sells its solutions through its direct sales teams. ShotSpotter, Inc. was founded in 1996 and is headquartered in Fremont, California.
How the Company Makes MoneySoundThinking Inc. generates revenue through the sale and subscription of its ShotSpotter technology services to municipalities, law enforcement agencies, and other organizations concerned with public safety. Key revenue streams include subscription fees for access to its gunshot detection and location services, professional services fees for implementation and support, and equipment sales related to the deployment of its technologies. The company may also engage in strategic partnerships with city governments and public safety departments to expand the adoption of its services, further contributing to its earnings.
SoundThinking Inc Financial Statement Overview
Summary
SoundThinking Inc shows solid revenue growth and strong cash flow management, but faces challenges with profitability and equity stability. Continued focus on improving margins is crucial.Income Statement
SoundThinking Inc has shown a steady increase in revenue over the years, with a notable increase from 2021 to TTM (Trailing-Twelve-Months). However, the company is struggling with profitability, as indicated by negative EBIT and net income margins, particularly in the TTM period.67
Positive
Balance Sheet
The company's balance sheet shows a healthy equity position with a reasonable debt-to-equity ratio. However, the recent decrease in stockholders' equity and the presence of net losses could indicate potential stability risks if not addressed.72
Positive
Cash Flow
SoundThinking Inc demonstrates strong operating cash flow, which consistently covers its capital expenditures resulting in positive free cash flow. The company has maintained a stable free cash flow to net income ratio, despite net income losses, showcasing good cash management practices.75
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 104.97M | 102.03M | 92.72M | 81.00M | 58.16M | 45.73M | Gross Profit |
| 59.89M | 58.49M | 52.84M | 46.78M | 32.52M | 26.98M | EBIT |
| -6.55M | -7.86M | -1.24M | -1.41M | -4.07M | -4.29M | EBITDA |
| 1.01M | 1.82M | 9.17M | 7.75M | 4.11M | 6.88M | Net Income Common Stockholders |
| -7.75M | -9.18M | -2.72M | 6.38M | -4.43M | 1.23M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 5.70M | 13.18M | 5.70M | 10.48M | 15.64M | 16.04M | Total Assets |
| 140.94M | 136.79M | 138.71M | 122.75M | 72.30M | 66.32M | Total Debt |
| 9.51M | 6.05M | 8.54M | 3.42M | 2.42M | 945.00K | Net Debt |
| 3.80M | -7.13M | 2.84M | -7.06M | -13.21M | -15.10M | Total Liabilities |
| 66.18M | 64.39M | 63.95M | 61.80M | 38.49M | 32.02M | Stockholders Equity |
| 74.76M | 72.40M | 74.76M | 60.95M | 33.81M | 34.30M |
| Cash Flow | Free Cash Flow | ||||
| 12.01M | 15.79M | 5.90M | 1.26M | 1.92M | 7.08M | Operating Cash Flow |
| 17.10M | 22.22M | 10.95M | 12.18M | 9.82M | 11.21M | Investing Cash Flow |
| -5.20M | -6.43M | -16.48M | -15.54M | -7.88M | -18.76M | Financing Cash Flow |
| -8.75M | -8.25M | 795.00K | -1.75M | -2.27M | -956.00K |
SoundThinking Inc Technical Analysis
Negative
15.51
Price Trends
16.20
Negative
14.98
Positive
13.82
Positive
Market Momentum
-0.14
Negative
47.82
Neutral
29.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSTI, the sentiment is Negative. The current price of 15.51 is below the 20-day moving average (MA) of 15.53, below the 50-day MA of 16.20, and above the 200-day MA of 13.82, indicating a neutral trend. The MACD of -0.14 indicates Negative momentum. The RSI at 47.82 is Neutral, neither overbought nor oversold. The STOCH value of 29.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SSTI.
SoundThinking Inc Risk Analysis
SoundThinking Inc disclosed 56 risk factors in its most recent earnings report. SoundThinking Inc reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SoundThinking Inc Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $214.99M | 9.43 | 15.02% | ― | 11.94% | 377.86% | |
67 Neutral | $196.56M | ― | -10.44% | ― | 7.65% | -96.35% | |
60 Neutral | $11.59B | 10.39 | -7.23% | 2.94% | 7.46% | -10.77% | |
57 Neutral | $262.18M | ― | -24.31% | ― | -12.13% | -39.21% | |
53 Neutral | $327.86M | ― | -7.51% | ― | -1.03% | 90.81% | |
53 Neutral | $231.49M | ― | -24.47% | ― | -8.39% | 7.79% | |
51 Neutral | $162.21M | ― | -22.66% | ― | -25.43% | -135.09% |
* Technology Sector Average
Performance Comparison
SSTI
SoundThinking Inc
15.51
1.02
7.04%
ALLT
Allot
8.26
6.14
289.62%
CRNT
Ceragon Networks
2.42
-0.33
-12.00%
VLN
Valens
2.48
-0.09
-3.50%
ONTF
ON24
5.45
-0.88
-13.90%
SMRT
SmartRent
0.86
-1.73
-66.80%
SoundThinking Inc Earnings Call Summary
Earnings Call Date:May 13, 2025
(Q1-2025)
| % Change Since: -4.38%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Positive
SoundThinking's earnings call reflected a positive outlook with significant revenue growth, successful contract renewals, and international expansion, despite some challenges related to increased expenses and potential cost impacts due to tariffs.Q1-2025 Updates
Positive Updates
Revenue Growth
SoundThinking delivered a 12% revenue growth year-over-year, reaching $28.3 million, driven by solid new sales and renewal activity.
Adjusted EBITDA Increase
Adjusted EBITDA grew 50% year-over-year to $4.5 million, highlighting operational leverage and a profitable growth strategy.
NYPD Contract Renewal
The New York City Police Department extended their ShotSpotter contract for an additional three years, totaling $64 million over a 3-year term.
International Expansion
SoundThinking expanded its ShotSpotter deployment internationally, with a new deployment in Niteroi, Brazil, marking a return to the Brazilian market.
SafePointe Legislative Opportunity
Following the passage of California Assembly Bill 2975, hospitals are required to deploy weapon detection systems at all public entrances by 2027, creating a significant market opportunity for SafePointe.
Innovation in CrimeTracer
CrimeTracer has evolved into a powerful AI-enhanced law enforcement tool, now integrating generative AI and large language models for insightful data analysis.
Negative Updates
Potential Cost Increases
The adjusted EBITDA margin guidance was reduced to 20% to 22% due to potential costs associated with tariff changes and investments in AI modeling and tools.
Municipal Funding Concerns
There are lingering headwinds related to municipal funding and budgets, which could impact future growth.
Q1 Expenses
The first quarter included higher expenses due to an annual all-hands meeting costing over $700,000 and increased legal and accounting costs.
Company Guidance
During SoundThinking's Q1 2025 earnings call, the company reported a strong financial performance with a 12% revenue growth year-over-year, reaching $28.3 million, and a 50% increase in adjusted EBITDA to $4.5 million. The growth was driven by new sales and contract renewals, notably a three-year $64 million contract with the NYPD. SoundThinking reaffirmed its full-year revenue guidance of $111-$113 million but adjusted its EBITDA margin guidance to 20-22% due to investments in AI and tariff impacts. The company highlighted international expansion, with a ShotSpotter deployment in Brazil, and emphasized the growth potential of its SafePointe product following new legislative requirements in California. They also noted ongoing strategic initiatives across various platforms, including ResourceRouter and CrimeTracer, as well as the integration of PlateRanger's data for enhanced investigative capabilities.SoundThinking Inc Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
SoundThinking Inc Appoints Burton Goldfield to Board
Positive
Apr 22, 2025
On April 17, 2025, SoundThinking, Inc. announced the appointment of Burton Goldfield to its Board of Directors as a Class II director, with roles on the Audit Committee and the Compensation and Human Capital Committee, effective immediately before the 2025 Annual Meeting on June 4, 2025. Deborah Grant was also appointed as the Board Chair. Goldfield, an independent director under Nasdaq standards, brings extensive leadership experience from his previous roles at TriNet Group, Ketera Technologies, Hyperion Solutions, and IBM Corporation. His appointment is expected to strengthen the company’s governance and strategic oversight.
Spark’s Take on SSTI Stock
According to Spark, TipRanks’ AI Analyst, SSTI is a Neutral.
SoundThinking Inc’s overall score reflects strong revenue growth and technical momentum, but is tempered by profitability challenges and cash flow volatility. While the technical outlook is positive, the valuation remains a concern due to financial losses. The earnings call provided optimistic guidance and highlighted strategic expansions, yet also acknowledged near-term revenue and expense challenges.
To see Spark’s full report on SSTI stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.