UiPath Stock Tanks Post Quarterly Results
07 Setembro 2022 - 10:54AM
Finscreener.org
Shares of
UiPath (NYSE:
PATH) are down over 20%
in pre-market trading today after the company announced its fiscal
second quarter (ended in July) of 2023 results. It reported revenue
of $242.2 million and an adjusted loss of $0.02 per share in the
quarter. Comparatively, analysts forecast revenue of $230.8 million
and adjusted earnings of $0.11 per share in Q2.
So, why is PATH stock price
falling off a cliff despite beating consensus estimates? Investors
were disappointed after UiPath issued disappointing revenue
guidance for Q3. In the quarter ending in October, the company
forecast revenue between $243 million and $245 million, compared to
estimates of $269.6 million.
For fiscal 2023, UiPath’s sales
forecast stood between $1 billion and $1.01 billion, below
estimates of $1.09 billion. Let’s see if the tech stock can stage a
comeback in the last quarter of the current year.
Is UiPath stock a buy right now?
UiPath provides an end-to-end
automation platform. It offers a wide range of RPA (robotic process
automation) solutions in the U.S., Japan, and Romania. Its suite of
integrated software allows enterprises to build, manage, run,
engage, measure, and govern automation across
enterprises.
In Q2, UiPath surpassed annual
recurring revenue of $1 billion and is forecast to reach ARR of
$1.15 billion by end of fiscal 2023. During the earnings call,
UiPath’s Co-Founder and CEO Robert Enslin stated, “The market is
evolving and UiPath is leading the way with our end-to-end platform
that covers the full automation lifecycle. To capitalize on the
significant opportunity in front of us we are strategically
repositioning the Company to elevate customer conversations, sell
business outcomes, and help organizations realize the
transformational benefits of automation.
We firmly believe these changes
will position us for both growth and profitability.”
UiPath was named a leader for the
fourth consecutive year by Gartner in its Magic Quadrant for RPA.
It was positioned highest for its ability to execute and
completeness of vision.
Due to its robust portfolio of
solutions, UiPath has managed to increase sales from $336 million
in fiscal 2020 to 892 million in fiscal 2022.
In Q2, it completed the
acquisition Re:infer, a London-based natural language processing
company for unstructured documents and communications. Re:infer
uses machine learning technology to mine context from communication
messages and transform them into actionable data.
UiPath also announced technology
integrations with Snowflake (NYSE:
SNOW), a cloud-based data
platform.
Is PATH stock undervalued or overvalued?
UiPath stock price has fallen by
77% from all-time highs. But the company is part of a rapidly
expanding addressable market, allowing it to surpass $1 billion in
ARR within seven years. A report from Grand View Research forecasts
the global RPA market to grow by 38% annually through 2030 to
almost $31 billion.
Given that UiPath has a 27% share
of the RPA market, it is well positioned to unlock multiple
opportunities in the upcoming decade. If UiPath maintains its
market share, the company’s sales will grow to $8.4 billion.
Further, if its market share improves to 30%, UiPath’s revenue
might touch $9.3 billion.
Analysts expect UiPath to
increase revenue by 22% to $1.1 billion in fiscal 2023 and by 28%
to $1.4 billion in fiscal 2024. So, PATH stock is valued at 6x
forward sales, given its market cap of $8.4 billion, which is quite
reasonable.
Considering consensus price
target estimates, UiPath stock is trading at a discount of 100%
right now.
UiPath (NYSE:PATH)
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