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Sonos Inc. (NASDAQ:SONO) is among the finest small cap tech shares to put money into now. On January 5, Jefferies raised its worth goal for Sonos to $21 from $19 with a Purchase score, characterizing 2026 as a yr of gradual AI monetization for the software program group. Whereas the agency expressed confidence that long-term worth will reside within the software program layer, it famous that traders may have to stay affected person as sector valuations return to historic averages. Moreover, Jefferies emphasised that extra important development acceleration is required to mitigate AI disintermediation fears, resulting in a extra selective funding strategy inside the sector.
In This fall 2025, Sonos Inc. (NASDAQ:SONO) posted income of $288 million, which was a 13% enhance year-over-year. Whereas full-year income declined by 5% to $1.44 billion, Sonos efficiently diminished its annual working expense run charge by over $100 million and grew its non-GAAP EPS by 31% to $0.64. Monetary self-discipline was additionally evident in stock administration, which noticed a 26% year-over-year discount to $171 million.
For 2026, CEO Thomas Conrad described the upcoming yr as a brand new chapter targeted on a refreshed technique that emphasizes the Sonos platform as a cohesive system for third-party and first-party AI experiences. Regardless of the constructive momentum, the corporate faces headwinds from tariffs, that are anticipated to impression margins by 300 foundation factors in Q1 and 400 foundation factors in Q2. Administration is proactively mitigating these prices via strategic pricing and promotions. For Q1 2026, Sonos supplied income steerage of $510 million to $560 million.
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Sonos Inc. (NASDAQ:SONO), along with its subsidiaries, designs, develops, manufactures, and sells audio services within the Americas, Europe, the Center East, Africa, and the Asia Pacific.
Whereas we acknowledge the potential of SONO as an funding, we imagine sure AI shares supply higher upside potential and carry much less draw back threat. When you’re in search of a particularly undervalued AI inventory that additionally stands to learn considerably from Trump-era tariffs and the onshoring pattern, see our free report on the finest short-term AI inventory.
READ NEXT: 30 Shares That Ought to Double in 3 Years and 11 Hidden AI Shares to Purchase Proper Now.
Disclosure: None. This text is initially revealed at Insider Monkey.
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