Meet the Supercharged Growth Stock That Could Make You a Millionaire

If you're like most investors, you're not starting out with a ton of money. If you're going to achieve the dream of becoming a millionaire, then you're going to need to do it just a little at a time, using a bit of your income that isn't consumed by life's ordinary expenses.

You also probably know that investing in stocks is the only way to meaningfully and reliably outpace the impact of inflation; the S&P 500's average annual return is in the ballpark of 10%.

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What if, however, you could also supercharge your portfolio with a growth stock that has the potential to beat the broad market for a long while? These names obviously bring more risk to the table with their greater potential for reward. But sometimes, that additional risk is worth it.

An artificial intelligence (AI) technology company called SoundHound AI (NASDAQ: SOUN) is one such stock, made even more attractive by the 60% pullback from its December peak.

What's SoundHound AI?

Never heard of SoundHound? It wouldn't be surprising if you hadn't. It's neither as big nor as high-profile as AI tech titans like Nvidia or Microsoft. SoundHound's market capitalization is a much more modest $3.8 billion right now. It just doesn't turn many heads. There's a good chance, however, that you've used its technology without even realizing it.

SoundHound's top skill is turning the spoken word into automated and actionable digital information. It simplifies and speeds up (and improves) fast food drive-thru ordering, allows automobiles to accept drivers' voice-activated commands, and can turn a house into a true smart home, operated by the resident's spoken instructions.

Honda, fast food chain White Castle, and streaming music platform Pandora are just some of the names currently utilizing SoundHound's technology. More are joining the fold on a regular basis, too.

It's admittedly not exactly a brand-new idea. Speech-recognition telephony has been around and relatively common since the '90s. But it's been clunky at best, and downright useless at its worst. It required the advent of large language model-based artificial intelligence for the idea to live up to the initial dream.

But make no mistake -- it is living up to the dream now. Market research outfit Straits Research believes the global voice and speech recognition technology market is poised to grow at an average annual pace of 17% through 2033.

For its part, we learned late Thursday that SoundHound's top line grew an incredible 85% to $84.7 million in 2024, en route to what the company expects to roughly be twice that amount this year. The growth pace should slow down from there, but only because that's when SoundHound's capacity to deliver will finally catch up with demand.

Data source: StockAnalysis.com. Chart by author.

Given the strength of its technology, this company looks positioned to capture more than its fair share of the industry's growth.

Look past the noise to gain the proper perspective

This backdrop begs the question: If SoundHound's story is so bullish, why are its shares down on the order of 60% from their recent record high reached in December?

To fully understand this sell-off, you actually need to go back to October of last year, before this stock began a meteoric run-up. That's when investors were first discovering this mostly unknown gem, and quickly falling in love with the premise. SoundHound also became something of a meme stock around that time, fanning the bullish flames.

As is so often the case, of course, the overextended red-hot rally imploded. Then just last week, Nvidia disclosed that it had sold its own position in SoundHound's stock, further rattling the company's already-nervous shareholders. Now, the sell-off seems to have taken on a life of its own, perhaps further fueled by fears that Thursday evening's release of its fourth-quarter numbers would prove problematic. (Spoiler alert: They didn't.)

Here's the thing. Nothing about this rise and fall is particularly unusual. SoundHound is hardly the world's first pre-profit tech stock to soar on hype and FOMO -- the fear of missing out -- and then plunge when reality sets in.

The good news is, such a sweeping swing usually only has to happen once to a story stock like this one. That is to say, although SoundHound shares will likely remain more volatile than the typical ticker going forward, it's unlikely we'll see investors lose perspective with this company again, which is what allowed the stock to rise and fall as it has over the course of just the past few months. From here, shares should start being priced with at least a little more sensical acknowledgement of the company's current and projected results.

It would also be naive to believe Nvidia wasn't at least a little bit incentivized to lock in big profits on its SoundHound trade. But for what it's worth, the analyst community has remained steadfast in its bullish stance despite shares' recent bearishness. Most of them consider this stock a buy, while none rate it lower than a hold. They're also maintaining a consensus price target of $14.06, which is more than 50% above the stock's present price.

Buckle up for volatility

Sure, the stock's big jump following Thursday evening's release of its fourth quarter results presents something of a conundrum. Any investor would rather pay a lower price for a stock, but this particular ticker may never revisit its pre-report price.

Just don't major in the minors. That is to say, for investors on the hunt for a high-powered long-term holding, it won't really matter if you bought in as low as you possibly could or perhaps paid a bit of a premium for it. The only thing Thursday's pre-close weakness followed by the stock's post-close surge proves is that SoundHound's shares are volatile. But, we already knew that was the case.

Bottom line? If you're willing to take on a bit more risk to own a stock with the potential for above-average gains, consider a stake in SoundHound AI.

Should you invest $1,000 in SoundHound AI right now?

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James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.