I recently compared two artificial intelligence (AI) stocks, SoundHound AI (SOUN) and C3.ai (AI), using TipRanks’ Comparison Tool to determine which one is better. Upon closer examination, it appears that there is a neutral view on SoundHound and a bearish view on C3.ai.
SoundHound AI offers conversational intelligence through its independent voice-AI platform, allowing businesses to provide conversational experiences to their customers. On the other hand, C3.ai is an enterprise AI company that provides software-as-a-service applications for developing large-scale enterprise AI applications.
The stock of SoundHound AI has seen a 128% surge year-to-date, with a 97% return over the past 12 months. In contrast, C3.ai shares have declined by 6.5% year-to-date and 35% over the last year. Given this significant difference in their share-price performances, the gap in their valuations is not surprising.
SoundHound AI currently trades at a price-to-sales (P/S) ratio of 32x, indicating a premium compared to the application software industry. While the company is not profitable, its partnership with automaker Stellantis is a positive development for its long-term prospects.
On the other hand, C3.ai has a P/S ratio of 11.4x, making it more reasonably valued than SoundHound. However, the company’s profitability outlook is less promising, with widening net losses and no clear path to profitability in sight.
In conclusion, both SoundHound AI and C3.ai show potential for long-term success, but it might be premature to invest in them at this time. It would be prudent to wait for more progress towards profitability before considering these stocks.