This $8 Stock Could Be Your Ticket to Becoming a Millionaire

Finding a dirt-cheap stock, loading up on shares, and having a meager investment transform into $1 million is a dream of many investors. While many stocks promise to fulfill this lofty goal, I think there's one $8 stock that could make it happen: SoundHound AI (NASDAQ: SOUN).

SoundHound AI trades for a little more than $8, but I believe it could lead to phenomenal returns over the next few years as its vision takes shape.

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SoundHound AI could be a major player in AI

SoundHound AI combines audio recognition technology with AI, allowing it to automate several tasks that humans normally do. It has already successfully deployed its technology in a few key areas, such as restaurant automation. If you've had an order taken by an AI agent at a drive-thru, chances are high that it was SoundHound AI's technology powering that interaction. While the fast food market isn't a huge space, there are much larger industries with armies of customer service agents that SoundHound AI could automate.

Finance, healthcare, and insurance are some of the major targets, and SoundHound AI already has deals with several of them to explore integrating its product into its clients' systems. To support this, it rolled out OASYS, which helps the AI interact with itself and improve in real time to tackle new situations it's encountering. That's a major development, and could be a piece of the puzzle that SoundHound AI needs to become a millionaire-maker stock.

What exactly needs to happen to turn this $8 stock into a $800 stock? The biggest thing is to continue growing its business at a steady pace. In Q1, its revenue rose at a 52% clip. That's a solid growth rate for SoundHound AI, but it needs to keep that up over several years to deliver 100x returns. Over that time frame, SoundHound AI also needs to generate a profit. It shouldn't surprise investors that it's currently highly unprofitable, as it's spending every penny it can to innovate and develop a platform that can automate several roles. In Q1, its operating loss was nearly $23 million compared to $44 million in revenue. That means it's spending about 50% more than it's bringing in the door, which is unsustainable.

If SoundHound AI can grow into a major market opportunity, achieve profitability, and sustain its rapid growth rate over the next decade, it could deliver millionaire-maker returns. However, there's no guarantee of success, as another AI competitor could easily tackle this market sector and be a major competitor. Time will tell where SoundHound AI ends up, but I think it's worth a small investment to see what happens.

Keithen Drury has positions in SoundHound AI. The Motley Fool has positions in and recommends SoundHound AI. The Motley Fool has a disclosure policy.