Artificial Intelligence (AI) has been a primary catalyst behind the rally in the financial market over the past year. Given its rapid adoption and deployment across various sectors, the trend could be sustained in 2024 as well. With this in mind, we have identified two AI stocks – Nvidia (NASDAQ:NVDA) and SoundHound AI (NASDAQ:SOUN) – with a Strong Buy consensus rating and upside potential of over 30%.
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Are Nvidia Shares a Good Buy?
According to analysts, Nvidia stock is a Strong Buy based on 31 Buy recommendations and three Hold ratings. Nvidia has been the leader in the AI space, with its GPUs (graphics processing units) considered the engine powering the AI revolution.
Notably, AI presents a multi-year growth opportunity for Nvidia, driving its revenue and cash flows. The strong, broad-based demand for Nvidia’s accelerated computing products and its focus on launching new products augur well for growth.
Thanks to the stellar demand for its products, Nvidia stock has gained about 234% year-to-date. Meanwhile, analysts’ average price target suggests further upside in NVDA stock over the next 12 months. Analysts have an average price target of $661.35 on NVDA shares, representing 35.44% upside potential from current levels.
What is the Outlook for SOUN Stock?
SoundHound offers voice AI solutions. The company’s focus on expanding its Chat AI platform and channel partner ecosystem has led to solid growth in its revenue and solidified its competitive positioning in the voice AI space.
Besides for organic growth, SOUN focuses on strategic acquisitions to expand its product portfolio and accelerate growth. It recently announced the acquisition of SYNQ3 to broaden its AI customer service solutions. The deal positions SoundHound as the leading voice AI provider for restaurants in the United States, substantially expanding its market presence to more than 10,000 locations.
Four analysts cover SOUN stock, and all recommend a Buy. SOUN stock has gained about 17% year-to-date. Meanwhile, the average analysts’ price target of $4.40 per share suggests 112.56% upside potential over the next 12 months.
Bottom Line
Nvidia and SoundHound are poised to benefit from the growing deployment of AI over the next year. Further, Wall Street analysts are bullish about NVDA and SOUN stocks in the AI sector. Also, these stocks offer significant upside potential over the next 12 months based on analysts’ average price target.
