UiPath’s AI Automation Story Is Not Translating Into Faster Growth Yet, Say UBS, Morgan Stanley Analysts

• Morgan Stanley analyst Sanjit Singh also trimmed his price target to $17 from $19.
• Analysts say fourth-quarter results met expectations but see limited near-term upside due to modest growth.
• UBS added constant-currency net new annual recurring revenue hasn’t meaningfully grown, signaling weak new business momentum.

Shares of UiPath Inc. (PATH) remain under close watch after two major Wall Street firms revised their outlook for the automation software company following its fourth-quarter (Q4) results. 

Analysts say the company delivered results largely in line with expectations but see limited near-term upside amid modest growth trends.

UBS Cuts Target After Earnings Review

Analysts at UBS reduced their price target for UiPath stock to $13 from $17 while maintaining a ‘Neutral’ rating, according to TheFly. The adjustment followed UiPath’s Q4 earnings update and forward guidance, which showed moderate growth expectations but lingering uncertainty around new subscription expansion. 

According to UBS, UiPath’s quarterly performance met Wall Street projections. The company also projected fiscal 2027 revenue growth of about 9% and annual recurring revenue growth of about 11%. While these estimates slightly exceed some investor expectations, the firm noted that constant-currency net new annual recurring revenue (NNARR) has yet to return to meaningful expansion, signaling subdued momentum in new business generation.

UiPath stock traded over 6% lower in Thursday’s premarket. However, on Stocktwits, retail sentiment around the stock remained in ‘extremely bullish’ territory and message volume changed to ‘extremely high’ from ‘high’ levels in 24 hours. 

Morgan Stanley Also Revises Price Target

A similar stance came from Morgan Stanley analyst Sanjit Singh, who trimmed his price target to $17 from $19 while keeping an Equal Weight rating. Singh said that Q4 recurring revenue trends indicate resilience even as automation companies face a challenging demand environment.

He added that UiPath’s fiscal 2027 annual recurring revenue guidance implies relatively flat net-new recurring revenue, suggesting stability rather than growth for the automation software sector during a period of broader economic uncertainty.

PATH stock has gained over 4% in the last 12 months. 

Also See: S&P 500 Could Drop Another 5%-7% Before Bottoming, Says Morgan Stanley's Chief Investment Officer: Report

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