UiPath stock rating maintained at Hold by Truist Securities

Investing.com - Truist Securities has reiterated its Hold rating and $13.00 price target on UiPath Inc. (NYSE:PATH), maintaining its cautious stance on the automation software provider. The stock currently trades at $12.56, with analyst targets ranging from $11.71 to $17.00, while maintaining impressive gross profit margins of 83%.

The firm’s analyst Terry Tillman made adjustments to quarterly estimates for fiscal year 2026, reducing second-quarter free cash flow projections which were "likely too aggressive post strong 1Q performance and in relation to Street." According to InvestingPro analysis, the company appears slightly undervalued based on its Fair Value calculations, with revenue growing at 7.2% year-over-year.

Truist also shifted subscription service revenue estimates from the third quarter to the fourth quarter, citing probable mis-modeling between the two periods.

Despite these adjustments, Truist’s key estimates for fiscal year 2026—including total revenue, annualized renewal run-rate, non-GAAP operating income, and free cash flow—remain aligned with company guidance and consensus Street expectations.

The firm acknowledged UiPath is "making aggressive moves with its combination of automation robots, AI agents and orchestration in a single agnostic platform emphasizing security and governance," but continues to maintain its Hold rating while looking for evidence of a growth inflection. InvestingPro offers 8 additional key insights about PATH’s financial health and growth prospects in its comprehensive Pro Research Report, available to subscribers.

In other recent news, UiPath Inc. reported earnings that exceeded expectations by over $20 million, notably in the $100K+ annual recurring revenue customer segment. This revenue beat was highlighted by Truist Securities, which reaffirmed a Hold rating for UiPath. BofA Securities also noted a year-over-year increase in UiPath’s Annual Recurring Revenue (ARR) to $1.693 billion, slightly surpassing their projections. Meanwhile, Canaccord Genuity raised its price target for UiPath to $16, maintaining a Buy rating, citing the company’s potential for growth and improving financial performance.

TD Cowen increased its price target to $15, acknowledging UiPath’s better-than-expected first-quarter results while maintaining a Hold rating. BofA Securities, however, kept an Underperform rating despite raising its price target to $12, reflecting caution amidst UiPath’s internal changes and market adaptation. Shareholders recently approved all proposals at UiPath’s annual meeting, including the election of eight directors and the ratification of KPMG LLP as the independent auditor.

UiPath’s management has indicated that restructuring efforts are largely complete, with a focus on balancing growth and operational efficiency. Additionally, the company secured a significant contract with the U.S. Air Force, showcasing its ongoing federal pipeline activities. These developments collectively portray a company navigating its challenges while seeking to capitalize on growth opportunities in the automation sector.

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