Posted 4/14/2024, 1:15:00 PM
Stocks Plunge as AI Companies Miss Growth Targets After SPAC Deals
- BigBear.ai and SoundHound AI are AI companies that went public via SPAC deals but have seen their stocks plunge as they missed growth targets
- BigBear.ai provides data analytics services but struggled with flat growth, declining margins, and the loss of a major customer
- SoundHound specializes in audio/speech recognition but also missed pre-merger forecasts and faces competition from tech giants
- SoundHound is growing faster than BigBear.ai, has an arguably wider moat, and operates at a much higher gross margin
- SoundHound may be the better speculative buy given its superior growth and business model sustainability, although both stocks remain risky