UiPath (PATH) Outpaces Market Returns: Some Facts to Consider

The most recent trading session ended with UiPath (PATH) at $20.41, reflecting a +1.09% move from the previous trading day’s close. This move outpaced the S&P 500’s 0.12% gain on the day. Elsewhere, the Dow gained 0.34%, while the tech-heavy Nasdaq lost 0.07%.

Business Automation Software Developers’ stock has risen 6.04% over the past month, leading the Business Services sector’s gain of 3.14% and the S&P 500’s gain of 4.99%.

Investors will be eagerly watching UiPath’s performance when it next releases its earnings. The company’s earnings report is expected to be unveiled on May 29, 2024. The company is expected to report EPS of $0.11, marking stability compared to the same quarter of the previous year. Meanwhile, our most recent consensus estimate is calling for revenue of $332.84 million, indicating an increase of 14.93% from the same quarter last year.

For the full fiscal year, Zacks Consensus Estimates are projecting earnings of $0.57 per share and revenue of $1.52 billion, representing changes of +5.56%+ 15.86%, respectively, compared to the previous year.

Investors should also pay attention to the latest changes in analyst estimates for UiPath. Such recent changes usually signify a changing landscape of short-term business trends. Therefore, upward estimate revisions express analysts’ positivity towards the company’s business operations and its ability to generate earnings.

Research indicates that these estimate revisions are directly correlated with near-term stock price momentum. To take advantage of this, we have constructed the Zacks Rank, a proprietary model that takes these estimated changes into account and provides an operational rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), has an admirable, independently audited track record of outperformance, with #1 stocks contributing an average annual return of +25 % since 1988. The Zacks Consensus EPS estimate remained stagnant over the past month. UiPath currently has a Zacks Rank of #3 (Hold).

From a valuation perspective, UiPath currently trades at a forward P/E ratio of 35.24. This means a premium to its industry’s average Forward P/E of 24.94.

We can also see that PATH currently has a PEG ratio of 1.57. This metric is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Technology Services stocks average a PEG ratio of 1.67 based on yesterday’s closing prices.

The technology services industry is part of the business services sector. This group has a Zacks Industry Rank of 57, putting it in the top 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

Be sure to leverage Zacks.com to stay up-to-date with all of these stock-changing metrics and more in upcoming trading sessions.

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