UiPath Stock Appears Undervalued Based on Forward P/S Ratio

UiPath Inc. PATH appears attractively valued compared with its industry peers based on the forward 12-month price-to-sales (P/S) ratio. Currently trading at 4.37x, PATH’s valuation falls short of the industry average of 5.68x, suggesting the stock may offer a relative bargain for growth-focused investors. As a leader in robotic process automation, UiPath has continued to expand its enterprise footprint, with growing adoption across finance, healthcare and logistics sectors.Image Source: Zacks Investment ResearchDespite macroeconomic uncertainty, the company has maintained solid top-line performance, driven by a combination of strong recurring revenues and international expansion. The lower P/S ratio reflects market caution, possibly tied to concerns about profitability or broader tech-sector volatility. However, for long-term investors, PATH’s product breadth, developer ecosystem and recurring revenue model could warrant a re-evaluation of its current discounted valuation.The company's investments in AI-powered automation and integrations with major platforms like Microsoft and SAP enhance its long-term relevance. As digital transformation continues to be a strategic priority for enterprises, UiPath remains well-positioned to benefit from secular demand trends, even if short-term sentiment remains cautious.PATH vs. Peers: Valuation and Market PositionCompared with peers like ServiceNow NOW and Pegasystems PEGA, UiPath’s valuation looks modest. ServiceNow trades at a significantly higher forward P/S multiple due to its broad enterprise suite and consistent profitability. Still, PATH’s 4.37x ratio offers a more accessible entry point for investors seeking RPA exposure.Image Source: Zacks Investment ResearchPegasystems, another player in the automation and customer engagement software space, also trades at a higher P/S ratio than PATH. While PEGA benefits from strong client relationships, PATH’s faster revenue growth and deeper automation focus could support stronger long-term upside, highlighting its relative value in the enterprise software landscape. Image Source: Zacks Investment ResearchPATH currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.5% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report UiPath, Inc. (PATH): Free Stock Analysis Report ServiceNow, Inc. (NOW): Free Stock Analysis Report Pegasystems Inc. (PEGA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks