SoundHound AI (NASDAQ:SOUN) and BigBear.ai (NYSE:BBAI) Financial Contrast

BigBear.ai (NYSE:BBAI) and SoundHound AI (NASDAQ:SOUN) are both mid-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, profitability, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a summary of current ratings for BigBear.ai and SoundHound AI, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BigBear.ai	1	2	1	0	2.00
SoundHound AI	2	2	5	1	2.50

BigBear.ai currently has a consensus target price of $6.00, suggesting a potential upside of 1.52%. SoundHound AI has a consensus target price of $16.07, suggesting a potential upside of 47.44%. Given SoundHound AI’s stronger consensus rating and higher possible upside, analysts clearly believe SoundHound AI is more favorable than BigBear.ai.

Institutional and Insider Ownership

7.6% of BigBear.ai shares are held by institutional investors. Comparatively, 19.3% of SoundHound AI shares are held by institutional investors. 0.5% of BigBear.ai shares are held by company insiders. Comparatively, 9.2% of SoundHound AI shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares BigBear.ai and SoundHound AI’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BigBear.ai	-274.70%	-26.11%	-12.37%
SoundHound AI	-211.16%	-93.64%	-51.73%

Risk & Volatility

BigBear.ai has a beta of 3.46, suggesting that its stock price is 246% more volatile than the S&P 500. Comparatively, SoundHound AI has a beta of 2.65, suggesting that its stock price is 165% more volatile than the S&P 500.

Valuation & Earnings

This table compares BigBear.ai and SoundHound AI”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BigBear.ai	$158.24 million	16.30	-$295.55 million	($1.42)	-4.16
SoundHound AI	$84.69 million	54.07	-$350.68 million	($0.84)	-12.98

BigBear.ai has higher revenue and earnings than SoundHound AI. SoundHound AI is trading at a lower price-to-earnings ratio than BigBear.ai, indicating that it is currently the more affordable of the two stocks.

Summary

SoundHound AI beats BigBear.ai on 9 of the 15 factors compared between the two stocks.

About BigBear.ai

BigBear.ai Holdings, Inc. provides artificial intelligence-powered decision intelligence solutions. It offers national security, supply chain management, and digital identity and biometrics solutions. The company also provides data ingestion, data enrichment, data processing, artificial intelligence, machine learning, predictive analytics, and predictive visualization solutions and services. It serves nation defense and intelligence agencies, border protection, transportation security, manufacturing, distribution and logistics, travel, entertainment, and tourism sectors. The company is headquartered in Columbia, Maryland.

About SoundHound AI

SoundHound AI, Inc. develops independent voice artificial intelligence (AI) solutions that enables businesses across automotive, TV, and IoT, and to customer service industries to deliver high-quality conversational experiences to their customers. Its products include Houndify platform that offers a suite of Houndify tools to help brands build conversational voice assistants, such as Application Programming Interfaces (API) for text and voice queries, support for custom commands, extensive library of content domains, inclusive software development kit platforms, collaboration capabilities, diagnostic tools, and built-in analytics; SoundHound Chat AI that integrates with knowledge domains, pulling real-time data like weather, sports, stocks, flight status, and restaurants; and SoundHound Smart Answering is built to offer customer establishments custom AI-powered voice assistant. The company's products also include CaiNET software that uses machine learning to enhance how domains work together to handle queries; CaiLAN software that arbitrates responses so users get answers from the right domain; Dynamic Interaction a real-time, multimodal customer service interface; Smart Ordering which offers an easy-to-understand voice assistant for restaurants; Employee Assist; automatic speech recognition; natural language understanding; wake words; custom domains; text-to-speech; and embedded voice solutions. The company was founded in 2005 and is headquartered in Santa Clara, California.