Shares of UiPath (PATH) have been strong performers lately, with the stock up 30.6% over the past month. The stock hit a new 52-week high of $18.98 in the previous session. UiPath has gained 46.9% since the start of the year compared to the 29% move for the Zacks Computer and Technology sector and the 9.6% return for the Zacks Internet - Software industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on December 3, 2025, UiPath reported EPS of $0.16 versus consensus estimate of $0.14 while it beat the consensus revenue estimate by 4.71%.
For the current fiscal year, UiPath is expected to post earnings of $0.65 per share on $1.58 in revenues. This represents a 22.64% change in EPS on a 10.65% change in revenues. For the next fiscal year, the company is expected to earn $0.72 per share on $1.71 in revenues. This represents a year-over-year change of 10% and 8.16%, respectively.
Valuation Metrics
UiPath may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
UiPath has a Value Score of F. The stock's Growth and Momentum Scores are B and A, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 28.7X current fiscal year EPS estimates, which is not in-line with the peer industry average of 29.8X. On a trailing cash flow basis, the stock currently trades at 615.5X versus its peer group's average of 24X. Additionally, the stock has a PEG ratio of 1.21. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this is even more important than the company's VGM Score. Fortunately, UiPath currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if UiPath fits the bill. Thus, it seems as though UiPath shares could still be poised for more gains ahead.
How Does PATH Stack Up to the Competition?
Shares of PATH have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Five9, Inc. (FIVN). FIVN has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. Five9, Inc. beat our consensus estimate by 90.48%, and for the current fiscal year, FIVN is expected to post earnings of $3.17 per share on revenue of $1.15 billion.
Shares of Five9, Inc. have gained 4.1% over the past month, and currently trade at a forward P/E of 7.05X and a P/CF of 9.46X.
The Internet - Software industry is in the top 27% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PATH and FIVN, even beyond their own solid fundamental situation.
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UiPath, Inc. (PATH): Free Stock Analysis Report Five9, Inc. (FIVN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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