Should You Buy This AI Stock That Soared 800% Last Year and Has a $140 Billion Total Addressable Market?

Last year was a big one for artificial intelligence (AI) stocks, with companies in the sector leading all three major benchmarks to gains

Though the momentum halted temporarily earlier this year, as investors worried the impact of import tariffs on the economy, this positive energy has returned

Investors are optimistic that trade talks will result in lower-than-expected tariffs, limiting the negative effects on companies, and that has buoyed interest in growth players, including AI stocks

Some AI stocks, though, have yet to feel the rebound

Considering the long-term AI growth story hasn't changed, these players may offer you bargain buying opportunities today

Let's consider one in particular

Is this player a buy right now

Image source: Getty Images

Though other companies, even big players such as Amazon or Microsoft, are involved in the field, SoundHound stands out thanks to its speech-to-meaning nology

The company translates speech directly to meaning, bypassing the common step of translating speech to text first, therefore gaining in speed and quality

Customers ly SoundHound's offerings, as revenue has taken off, and the company has signed deals across industries

This is a key point because, in its earlier days, SoundHound primarily served the automobile industry

That's because if one customer or industry cuts spending, others may compensate

And the company has three ways to generate revenue: through royalties on its ducts, subscriptions for services, and taking additional revenue from the use of its ducts and services

The risk of competition Of course, despite SoundHound's expertise in the field, the company still faces the risk of major rivals, such as those mentioned above, gaining market due to their immense resources

That's what makes SoundHound a stock that carries some risk right now, and even though the stock has slipped this year, the decline looks small compared to the gain posted last year

These factors could limit SoundHound's growth in the near term

Further, as mentioned above, SoundHound may still be in its early stages of growth

So, what does this mean for you as an investor

Should you buy SoundHound now on the dip

The answer depends on your investment strategy

If you're a cautious investor, you're bably better off buying a larger, well-established player, such as Amazon or Microsoft, that may benefit from voice AI but also from broader, fitable es

Over time, they've ven their earnings and stock performance strengths

If you're an aggressive investor, though, SoundHound looks a fantastic AI buy right now

The stock has slipped from its high, offering you a lower entry point

Revenue has ly accelerated in recent quarters, and the company has successfully broadened its customer base across industries

All this makes it a great AI stock to get in on right now and hang on to as its growth story develops

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors

Adria Cimino has positions in Amazon

The Motley Fool has positions in and recommends Amazon and Microsoft

The Motley Fool has a disclosure policy.