SoundHound stock’s rally continued Thursday as shares soared again after the voice AI company announced a deal with Torchy’s Tacos — the maker of “damn good tacos” — to use its technology at all 130 of the restaurant’s locations.
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Santa Clara, Calif.-based SoundHound AI (SOUN) went public in 2022. The company provides AI voice tech to devices, business kiosks and call centers. It’s also gaining traction in the restaurant industry, where SoundHound has also signed deals with Chipotle, Jersey Mike’s, White Castle, Panda Express and Church’s Texas Chicken.
Now, Torchy’s Tacos is signing onto the trend. Torchy’s describes itself as a “cult-favorite taco chain.” It makes items like the “trailer park taco” and the “green chile queso.”
“At Torchy’s Tacos, we want our guests to have the best experience every time they engage with the brand,” Thai Tran said in a written statement. Tran is Torchy’s chief technology officer. “Partnering with SoundHound and using their Smart Ordering system, we are able to give guests another way to easily order our food.”
SoundHound Stock Rallies On Nvidia News
SoundHound, which had been a sleepy stock, suddenly was in the Wall Street spotlight after AI giant Nvidia (NVDA) disclosed that its has taken an investment stake in the company.
“We think every product is going to benefit from voice AI,” SoundHound Chief Executive Keyvan Mohajer told Investor’s Business Daily in a recent interview. “And then every service also is going to benefit from an AI agent. Those are the two pillars of our business.”
At the close, SoundHound stock surged 31.3% to 13.33. That put shares within striking distance of their intraday record high at 18.14, achieved in May 2022.
SoundHound shares are about 117% ahead of their 50-day moving average and roughly 153% north of their 200-day line, MarketSurge chart analysis shows. With the stock so extended in such a short period of time, it would be prudent for investors to take partial profits at the current level.
Traders can also use a downside reversal off highs as another level to trim, followed by an undercut of the prior day’s lows. Shareholders can then use the 10-day and 21-day moving averages as other areas to lock in gains.
But buying a stock that’s wildly extended is very risky. Savvy investors should wait for the stock to settle down and form a new buyable area, ideally a high-tight flag. That’s a rare, bullish pattern that leading stocks tend to develop in strong markets.
SoundHound stock has a perfect IBD Digital Relative Strength Rating of 99. This means shares rank in the leading 1% of all stocks when it comes to 12-month performance.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
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