The stock market has recovered from April's sudden dip. From the S&P 500 to the Nasdaq Composite, the market-defining indexes are reaching fresh all-time highs almost every day. As of June 27, those portfolios had gained 12.6% and 13.6%, respectively, over the last year.

As a result, some of the best artificial intelligence (AI) stocks are running a bit hot again. I'm keeping a close eye on SoundHound AI (SOUN -0.91%) and Micron Technology (MU -0.98%) at the moment. Their stocks look a bit pricey today, but I'm ready to pounce on them in the next market dip.

SoundHound AI's big promises -- and why I'm waiting for a sale

I've been a SoundHound AI fan for years, and I expect big things from this company in the long haul. Voice-control systems are gaining momentum in many different markets, from in-car controls and phone-based menu systems to drive-through windows and data center operations.

SoundHound AI has been fine-tuning its AI-based voice interpretation tools since smartphones were new and hot. These days, the company offers agentic AI, process automation, and real-time conversations. The client list includes many of your favorite consumer electronics and carmaker brands. Their long-term contracts are starting to kick in, converting SoundHound AI's billion-dollar order backlog into actual revenues.

Yet, I can't quite recommend this stock right now. SoundHound AI's shares posted artificial gains in a meme-stock moment in late 2024, and the peak prices are now long gone, but some lingering market effects remain. The stock is up 155% over the last 52 weeks, and it looked expensive at the start of that surge.

So, one of two things must happen before I smash SoundHound AI's buy button again.

• The company could earn its lofty valuation by publishing dramatically stronger financials. Again, the beefy order backlog should generate lots of business over the next several years, but the revenue conversion process has been slow so far.
• The stock could take another haircut. This could happen over time as the meme stock mania fades out or very quickly alongside a downturn in the broader stock market.

I don't mind waiting for SoundHound AI's business plan to gain traction. At the same time, this stock will be at the top of my list of buying ideas the next time every high-priced growth stock takes a big hit.

The art of waiting for a better price on Micron Technology

Micron enters this discussion from a different angle. The memory chip giant's stock often trades at rock-bottom valuations, but it has been skyrocketing since April's tariff-based market dip.

Mind you, the stock isn't exactly expensive even now. Micron's share price is up 95% from April's temporary market bottom, changing hands at a perfectly reasonable valuation of 22.8 times trailing earnings or 4.2 times sales.

So, why am I waiting for another market correction? Why not grab a few shares at today's stock price, which looks pretty fair in the first place?

Because I'm used to Micron trading at much lower valuation multiples. The company operates in a cyclical industry, tied to a mix of surprising and predictable shifts in the smartphone, data center, and PC markets. Micron investors have made a lot of money over the years by saving their buy-in cash for one of the seemingly inevitable downturns. That's the opposite of what's going on right now.

Image source: Getty Images.

Yes, Micron benefits from the general AI boom, partly thanks to a close partnership with AI accelerator leader Nvidia. Every number-crunching Nvidia Blackwell card comes with several dozen gigabytes of Micron's most advanced high-bandwidth memory (HBM). This close connection to the explosive AI opportunity could lift Micron's stock even higher.

Call me a creature of habit; I'm just more comfortable waiting for the next price drop. Whether it springs from inflation fears or memory-chip price wars, you will almost certainly see one of those Micron buying windows open up in the next year or two. It's OK if I'm wrong, since my personal portfolio already holds a large helping of Micron stock. If I didn't have that advantage, I might consider buying a few shares at today's unusually high prices as well.

Your mileage may vary, of course. I'd still save most of my cash for a rainy day around Micron's Idaho headquarters.