PATH and APP: Two AI Stocks Worth Buying, But One Stands Stronger

UiPath PATH and AppLovin Corporation APP are two standout names harnessing the power of artificial intelligence to revolutionize digital operations. UiPath dominates the robotic process automation (RPA) arena, deploying AI to enhance and automate enterprise workflows. Meanwhile, AppLovin has carved a strong niche in mobile advertising technology, leveraging AI to maximize app monetization and drive user growth.

As AI becomes an essential component of modern enterprise solutions, investors face a crucial decision: which of these innovation-driven tech players offers the stronger investment case today? Let’s explore their fundamentals, growth catalysts and valuations.

The Case for UiPath

UiPath’s advantage in automation comes from how well its platform turns AI ideas into everyday business efficiency. Instead of relying only on fixed, rule-based bots, the company is moving toward agentic AI, software agents that can understand intent, work across tasks and adjust within set limits. This shift makes automation more than a cost-cutting tool; it becomes a core system that supports how work gets done.

The real benefit is operating leverage. When AI agents manage workflows across different systems, companies can rely on a single central platform rather than on many separate tools. UiPath’s focus on orchestration makes adoption easier, encourages broader use within existing customers and strengthens long-term relationships. Over time, this supports margin growth without needing heavy spending to win new clients.

Governance adds another layer of strength. UiPath emphasizes AI that is controlled, transparent, and auditable, qualities that matter to large and regulated organizations. This reduces hesitation in adoption and speeds up decision-making. As businesses move from simple rules to smarter, reasoning-based processes, each new agent adds more value to the overall platform.

UiPath is benefiting from steadier annual recurring revenue performance, improving operational discipline and early traction in monetizing agentic AI capabilities. These factors collectively enhance UiPath’s relevance as enterprises move beyond basic task automation toward more intelligent, decision-driven workflows.

Continued expansion of partnerships with major technology leaders is expected to support broader platform adoption and unlock new growth avenues over time. While short-term volatility may persist, the combination of improving execution, expanding AI use cases and favorable long-term automation demand positions UiPath for potential acceleration as enterprise AI adoption deepens.

The Case for AppLovin

At the heart of AppLovin’s scalability lies its Axon engine, a machine-learning system designed to optimize ad placement, pricing, and performance in real time. Unlike traditional ad-tech models that rely heavily on manual optimization and sales intuition, Axon automates decision-making at a massive scale. This allows advertisers to deploy campaigns faster, test formats more efficiently and scale budgets with higher confidence in measurable returns.

The expansion of AppLovin’s self-service platform further strengthens this advantage. By reducing friction in campaign execution, the company is increasing wallet share among existing customers while attracting new advertisers who prioritize performance transparency. This operational ease is translating directly into higher incremental revenue, a key indicator of operating leverage.

Crucially, Axon’s capabilities are no longer limited to mobile gaming. The same performance-driven infrastructure is gaining traction in e-commerce advertising, significantly expanding AppLovin’s total addressable market. As non-gaming advertisers adopt the platform, revenue diversification improves without compromising margin stability.

Management’s outlook underscores this structural strength. Confidence in sustaining high double-digit growth alongside consistently strong EBITDA margins suggests Axon can scale efficiently. AppLovin’s growth, therefore, is increasingly anchored in platform economics rather than cyclical ad demand.

How Do Zacks Estimates Compare for PATH & APP?

The Zacks Consensus Estimate for UiPath’s fiscal 2026 sales and EPS indicates year-over-year growth of 11.5% and 26.4%, respectively. EPS estimates have been trending upward over the past 60 days.

The Zacks Consensus Estimate for AppLovin’s 2025 sales and EPS indicates year-over-year growth of 18.2% and 105.7%, respectively. EPS estimates have been trending downward over the past 60 days.

UiPath’s Valuation More Attractive Than AppLovin

UiPath is trading at a forward sales multiple of 4.58X, above its 12-month median of 4.26X. AppLovin’s forward sales multiple stands at 23.04X, above its median of 22.44X.

UiPath is a Strong Buy

While both UiPath and AppLovin stand out as strong AI-driven growth stories, PATH emerges as the more balanced and sustainable long-term buy. Its deep enterprise integration, high customer retention, and partnerships with tech giants strengthen its moat in the automation space. AppLovin’s explosive momentum in ad tech is impressive but comes with higher valuation risk. UiPath’s more reasonable multiple, predictable recurring revenues and consistent profitability trajectory make it a smarter, steadier play for investors seeking durable AI exposure across industries, positioning it as the stronger buy in this AI-driven tech duo.

While PATH sports a Zacks Rank #1 (Strong Buy), APP carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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