Investing in growth stocks is a tried and tested way of beating the broader market's gains, as fast-growing companies are capable of increasing their revenues and earnings at a faster pace than the market. Their above-average growth leads to healthy stock price increments, making investors richer in the process.
So, if your goal is to beat the broader market's gains and you have just $15 in investable cash right now, you can consider buying one share of SoundHound AI (SOUN -1.84%) with that money. The voice artificial intelligence (AI) solutions provider has lost 35% of its value so far in 2025, and each share of the company is now trading at under $15.
Let's look at the reasons why SoundHound could be the smartest growth stock that you can buy with just $15.
Image source: Getty Images.
SoundHound AI is growing at a breathtaking pace
SoundHound AI's voice AI platform allows its clients to build various types of solutions such as voice-enabled AI agents, smart ordering systems for restaurants, smart answering systems, AI-enabled chatbots for vehicles, and custom voice AI products. This is a fast-growing niche, which was worth just over $3 billion last year but is expected to generate $47.5 billion in revenue by 2034.
SoundHound AI is already making a nice dent in this space by building a solid and diversified customer base that's spread across restaurants, travel and hospitality, automotive, healthcare, financial services, and others. From popular carmakers such as Stellantis and Hyundai to tech companies such as Qualcomm and Snap to smart TV manufacturer Vizio, the list of SoundHound's customers is long.
This big and varied customer base explains why SoundHound's growth has been incredible since the company went public just over three years ago.
SOUN Revenue (TTM) data by YCharts
Importantly, the company has been taking steps to ensure that it remains one of the top players in the voice AI market by acquiring new companies and introducing new products. This strategy has allowed SoundHound to create a healthy revenue pipeline that should be enough for it to sustain impressive growth levels in the long run.
Management pointed out in December 2024 that SoundHound was sitting on a cumulative subscriptions and bookings backlog worth a whopping $1.2 billion. That figure is higher than the combined revenue that SoundHound is expected to generate in the current and the next two years.
SOUN Revenue Estimates for Current Fiscal Year data by YCharts
Of course, SoundHound does point out that this metric refers to "current estimates of future performance based on various assumptions, which may or may not prove to be correct." However, the size of the backlog seems solid enough to fuel robust growth in the future even if it isn't able to convert all of its potential pipeline into actual revenue.
Moreover, SoundHound estimates that its total addressable market stands at a tremendous $140 billion. So, there is a good chance that the size of its backlog could continue to increase, as the secular growth of the voice AI market should help it attract more customers toward its platform and also encourage existing ones to spend more on its offerings.
This is precisely why the previous chart points toward a potential acceleration in SoundHound AI's growth rate. Investors, however, might be wondering why SoundHound AI has taken a beating this year despite its outstanding growth and sunny prospects.
Growth investors should look beyond valuation concerns
SoundHound stock multiplied investors' wealth dramatically last year. As a result, its price-to-sales ratio shot up to more than 90 at the end of 2024. The turmoil in tech stocks earlier this year weighed on SoundHound, as investors booked profits in expensive stocks in a bid to preserve their capital amid the stock market uncertainty caused by tariffs and conflicts.
SoundHound's sales multiple is now down to 46. Though that is still expensive, investors need to keep in mind that the company is on track to nearly double its revenue in 2025 based on the midpoint of its revenue guidance range of $157 million to $167 million. As SoundHound is expected to sustain robust growth levels over the next two years, its forward sales multiples are lower.
SOUN PS Ratio (Forward) data by YCharts
The expensive valuation could expose SoundHound to volatility, but the company is in a position to justify the premium thanks to its impressive growth and the size of its addressable market. All this makes SoundHound AI a smart growth stock to buy with just $15 because it has the ability to keep growing at above-average rates in the long run.
