Analyzing SoundHound AI (NASDAQ:SOUN) & Altair Engineering (NASDAQ:ALTR)

SoundHound AI (NASDAQ:SOUN) and Altair Engineering (NASDAQ:ALTR) are both computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, analyst recommendations, earnings and valuation.

Analyst Recommendations

This is a breakdown of current ratings and target prices for SoundHound AI and Altair Engineering, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SoundHound AI	0	2	4	0	2.67
Altair Engineering	0	2	3	0	2.60

SoundHound AI currently has a consensus target price of $6.88, indicating a potential upside of 43.04%. Altair Engineering has a consensus target price of $94.60, indicating a potential upside of 11.03%. Given SoundHound AI’s stronger consensus rating and higher possible upside, equities analysts clearly believe SoundHound AI is more favorable than Altair Engineering.

Valuation & Earnings

This table compares SoundHound AI and Altair Engineering’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SoundHound AI	$45.87 million	32.41	-$88.94 million	($0.39)	-12.33
Altair Engineering	$612.70 million	11.47	-$8.93 million	$0.09	946.67

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
SoundHound AI	-188.57%	-1,955.68%	-62.57%
Altair Engineering	1.55%	5.60%	2.91%

Volatility & Risk

SoundHound AI has a beta of 2.87, indicating that its share price is 187% more volatile than the S&P 500. Comparatively, Altair Engineering has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500.

Insider and Institutional Ownership

19.3% of SoundHound AI shares are owned by institutional investors. Comparatively, 63.4% of Altair Engineering shares are owned by institutional investors. 21.3% of SoundHound AI shares are owned by insiders. Comparatively, 21.8% of Altair Engineering shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Altair Engineering beats SoundHound AI on 9 of the 14 factors compared between the two stocks.

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.

About Altair Engineering

Altair Engineering Inc., together with its subsidiaries, provides software and cloud solutions in the areas of simulation and design, high-performance computing, data analytics, and artificial intelligence in the United States and internationally. It operates in two segments, Software and Client Engineering Services. The Software segment offers solvers and optimization technology products, high-performance computing software applications and hardware products, modeling and visualization tools, data analytics and analysis products, and Internet of Things platform and analytics tools, as well as support and the complementary software products. This segment also provides software technologies in the areas of computational fluid dynamics and fatigue, manufacturing process simulation, and cost estimation for the applications in automotive, marine, motorcycle, aerospace, chemical, and architecture industries; and software-related services, such as consulting, implementation, and training services that focuses on the product design and development expertise and analysis from the component level up to complete product engineering at various stage of the lifecycle. The Client Engineering Services segment provides client engineering services. In addition, the company is involved in the development and sale of solid state lighting technology along with communication and control protocols based on its intellectual property for the direct replacement of fluorescent tubes with LED lighting. Its integrated suite of software optimizes design performance across various disciplines, including structures, motion, fluids, thermal management, electromagnetics, system modeling, and embedded systems. The company serves universities, government agencies, manufacturers, pharmaceutical firms, banking, financial services, and insurance, weather prediction agencies, and electronics design companies. Altair Engineering Inc. was incorporated in 1985 and is headquartered in Troy, Michigan.