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UiPath Stock is Consolidating This Year: What Should You Do?
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Key Takeaways
UiPath shares have moved sideways as the stock extends its consolidation phase.
Agentic Automation adoption is accelerating deal flow and boosting ARR momentum.
Alliances with major tech players and strong retention support revenue and profit growth.
UiPath Inc. (PATH - Free Report) shares have been flat year to date and are down 15% over the past three months. This performance suggests the stock may require a longer consolidation phase before any meaningful breakout occurs.
Image Source: Zacks Investment Research
Given PATH’s nearly year-long sideways trend, it’s worth evaluating whether the stock currently fits better as a buy, hold, or sell in today’s market environment.
Riding the Agentic Automation Wave
UiPath is seeing meaningful momentum from its Agentic Automation suite, which is now shaping customer acquisition, improving margins and supporting upward revisions to future earnings expectations. The standout development in the latest reported quarter is the rapid and commercially productive uptake of UiPath’s agent-based AI framework. Management emphasized that these AI-driven and agentic capabilities are helping the company close deals faster and secure larger contracts compared to traditional automation approaches.
The impact is visible: approximately 450 customers are already building agent-based workflows, and the platform has recorded nearly one million agent runs since launch. While deterministic automation still serves as the initial entry point for more than 95% of new customers, the accelerating shift toward AI across the existing customer base is driving the company’s real growth. These advanced capabilities are strengthening platform loyalty, fueling ARR momentum, and elevating UiPath’s overall profitability profile.
Strategic alliances with major tech companies like Microsoft (MSFT - Free Report) , Amazon (AMZN - Free Report) and Salesforce (CRM - Free Report) remain a key driver of growth. These partnerships not only enhance PATH’s credibility but also integrate its solutions into leading enterprise ecosystems, including Microsoft Azure, Amazon Web Services and Salesforce Cloud. Such collaborations amplify PATH’s reach and strengthen its value proposition across diverse industries.
High customer retention underscores PATH’s robust business model, with net retention rates at an impressive 108%. In the second quarter of fiscal 2026, the company reported revenues of $362 million, a 14% year-over-year increase, while annual recurring revenues rose 11% to $1.72 billion, highlighting strong customer loyalty and the resilience of its subscription-based model. With a broad global presence and a focus on intelligent automation, UiPath is well-positioned to maintain leadership in the evolving RPA and enterprise automation sector.
Financial Strength Underpins Growth
PATH’s financial health is equally compelling. As of the second quarter of fiscal 2026, the company held $1.4 billion in cash and cash equivalents, with zero debt. This debt-free status ensures that PATH can aggressively invest in innovation and strategic expansion without financial constraints.
Liquidity metrics are also strong, with a current ratio of 2.75, well above the industry average of 1.94. This indicates that PATH has ample short-term assets to cover liabilities, giving it the flexibility to navigate economic uncertainties and capitalize on emerging opportunities in the competitive automation market.
Analyst Outlook Remains Positive
Analyst projections point to continued growth for PATH. The Zacks Consensus Estimate forecasts third-quarter fiscal 2026 earnings of 14 cents per share, a 27% increase from the prior year. Earnings are projected to grow 23% in fiscal 2026, followed by 11% in fiscal 2027. Revenue growth is expected to reach 11% year-over-year this quarter, with 10% and 8% annual growth anticipated in fiscal 2026 and 2027, respectively.
Image Source: Zacks Investment Research
UiPath’s Consolidation Calls for Patience
UiPath appears best suited for a Hold at this stage. The stock has been consolidating for an extended period, and while momentum from its agentic automation framework is encouraging, the market may need more time to recognize the full impact. Strong traction in AI-driven workflows, deep enterprise partnerships, and high customer stickiness continue to support the long-term story. However, the stock’s sideways movement suggests a “wait and see” approach is prudent. Holding allows investors to benefit from UiPath’s strengthening fundamentals while monitoring for a clearer breakout signal driven by sustained demand for intelligent automation.
Image: Bigstock
UiPath Stock is Consolidating This Year: What Should You Do?
Key Takeaways
UiPath Inc. (PATH - Free Report) shares have been flat year to date and are down 15% over the past three months. This performance suggests the stock may require a longer consolidation phase before any meaningful breakout occurs.
Given PATH’s nearly year-long sideways trend, it’s worth evaluating whether the stock currently fits better as a buy, hold, or sell in today’s market environment.
Riding the Agentic Automation Wave
UiPath is seeing meaningful momentum from its Agentic Automation suite, which is now shaping customer acquisition, improving margins and supporting upward revisions to future earnings expectations. The standout development in the latest reported quarter is the rapid and commercially productive uptake of UiPath’s agent-based AI framework. Management emphasized that these AI-driven and agentic capabilities are helping the company close deals faster and secure larger contracts compared to traditional automation approaches.
The impact is visible: approximately 450 customers are already building agent-based workflows, and the platform has recorded nearly one million agent runs since launch. While deterministic automation still serves as the initial entry point for more than 95% of new customers, the accelerating shift toward AI across the existing customer base is driving the company’s real growth. These advanced capabilities are strengthening platform loyalty, fueling ARR momentum, and elevating UiPath’s overall profitability profile.
Strategic alliances with major tech companies like Microsoft (MSFT - Free Report) , Amazon (AMZN - Free Report) and Salesforce (CRM - Free Report) remain a key driver of growth. These partnerships not only enhance PATH’s credibility but also integrate its solutions into leading enterprise ecosystems, including Microsoft Azure, Amazon Web Services and Salesforce Cloud. Such collaborations amplify PATH’s reach and strengthen its value proposition across diverse industries.
High customer retention underscores PATH’s robust business model, with net retention rates at an impressive 108%. In the second quarter of fiscal 2026, the company reported revenues of $362 million, a 14% year-over-year increase, while annual recurring revenues rose 11% to $1.72 billion, highlighting strong customer loyalty and the resilience of its subscription-based model. With a broad global presence and a focus on intelligent automation, UiPath is well-positioned to maintain leadership in the evolving RPA and enterprise automation sector.
Financial Strength Underpins Growth
PATH’s financial health is equally compelling. As of the second quarter of fiscal 2026, the company held $1.4 billion in cash and cash equivalents, with zero debt. This debt-free status ensures that PATH can aggressively invest in innovation and strategic expansion without financial constraints.
Liquidity metrics are also strong, with a current ratio of 2.75, well above the industry average of 1.94. This indicates that PATH has ample short-term assets to cover liabilities, giving it the flexibility to navigate economic uncertainties and capitalize on emerging opportunities in the competitive automation market.
Analyst Outlook Remains Positive
Analyst projections point to continued growth for PATH. The Zacks Consensus Estimate forecasts third-quarter fiscal 2026 earnings of 14 cents per share, a 27% increase from the prior year. Earnings are projected to grow 23% in fiscal 2026, followed by 11% in fiscal 2027. Revenue growth is expected to reach 11% year-over-year this quarter, with 10% and 8% annual growth anticipated in fiscal 2026 and 2027, respectively.
UiPath’s Consolidation Calls for Patience
UiPath appears best suited for a Hold at this stage. The stock has been consolidating for an extended period, and while momentum from its agentic automation framework is encouraging, the market may need more time to recognize the full impact. Strong traction in AI-driven workflows, deep enterprise partnerships, and high customer stickiness continue to support the long-term story. However, the stock’s sideways movement suggests a “wait and see” approach is prudent. Holding allows investors to benefit from UiPath’s strengthening fundamentals while monitoring for a clearer breakout signal driven by sustained demand for intelligent automation.
PATH currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.