Key Takeaways
- Citi begins coverage of UiPath (PATH) with a Buy recommendation and $23 price objective
- The automation software stock tumbled 16% in the previous week, marking its most significant decline since early spring
- Bank of America increased its price objective to $15 while maintaining an Underperform stance
- Truist boosted its target to $17 and TD Cowen moved to $16, with both firms keeping Hold recommendations
- Second-quarter revenue climbed 13% to $410.26 million, surpassing Wall Street projections of $397.8 million
UiPath (PATH) received a bullish endorsement from Citi analysts on Tuesday as the investment bank launched coverage with a Buy recommendation and established a $23 price objective. The move comes after a challenging period for the automation platform provider, which experienced a 16% decline during the prior week—representing its most substantial weekly loss in over four months.
Shares ticked up 0.2% during Tuesday’s premarket session. The stock currently commands a premium valuation compared to industry peers, with Zacks assigning it a D grade on its Value Style Score metric.
Citi’s covering analyst Yitchuin Wang believes the post-earnings decline presents a compelling buying opportunity. Wang’s thesis centers on the premise that enterprise artificial intelligence implementations will demand orchestration across multiple components including agents, models, human operators, APIs, and robotic systems, with automation platforms remaining essential for governance frameworks and regulatory compliance.
Following UiPath’s fiscal second-quarter financial report, numerous Wall Street firms have adjusted their price objectives upward, though the increases are accompanied by cautious commentary.
Street Boosts Forecasts While Seeking AI Growth Validation
Bank of America’s Koji Ikeda elevated his price forecast to $15 from $13 but maintained an Underperform rating on the shares. He noted that the Q2 results failed to provide conclusive evidence on the central question facing investors: whether artificial intelligence capabilities will catalyze an acceleration in annual recurring revenue expansion. BofA did revise its financial model to incorporate more optimistic margin projections.
Truist Securities increased its price target to $17 from $12 while retaining a Hold rating. The firm acknowledges progress in agentic AI contract wins and modest improvements in customer acquisition metrics, but states it requires evidence of accelerating growth momentum before adopting a more constructive stance.
TD Cowen moved its target higher to $16 from $13, also maintaining a Hold recommendation. The firm highlighted consistent Q2 execution, stable customer retention figures, and expanding AI adoption as encouraging developments.
DA Davidson analyst Lucky Schreiner raised his price objective to $16 from $12 while staying at Neutral. He observed that UiPath exceeded annual recurring revenue projections and moderately increased its fiscal 2027 ARR guidance.
Second Quarter Delivers Revenue Upside
UiPath’s second-quarter revenue reached $410.26 million, representing a 13% year-over-year increase and beating the Street consensus estimate of $397.8 million. Adjusted earnings per share came in at $0.15, matching analyst expectations. Gross profit margin contracted to 80% from 82% in the year-ago period.
Looking at earnings projections, analysts anticipate UiPath will deliver $0.19 per share in the current quarter, reflecting an 18.8% year-over-year gain. The full fiscal year consensus forecast stands at $0.80 per share, implying 11.1% growth.
Zacks assigns PATH a #2 (Buy) ranking, citing consistent earnings estimate momentum despite the elevated valuation multiple.
Revenue projections for the ongoing quarter total $444.34 million, suggesting 8.1% year-over-year expansion.
The company has scheduled its investor day for September 22, when leadership is anticipated to outline strategic initiatives designed to accelerate growth trajectories.
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