Palantir Technologies (PLTR) just broke out of the buy range on earnings. Today, major fund managers are betting on an artificial intelligence and robotic process automation (RPA) company. UiPath (PATH) to then take off. As PLTR stock soars, PATH stock is eyeing another breakout, fueled by 140% earnings growth.
UiPath and Palantir were on this month's New Buys list of best mutual funds, released Friday. Proving that the AI boom is far from over, 14 other enterprise software industry peers also made this display.
While top-performing funds acquire PATH stock, tech powerhouses like Microsoft (MSFT), SAP (SAP) And Amazon.com (AMZN), through its cloud business Amazon Web Services, is partnering with UiPath to help improve productivity.
UiPath uses AI and RPA to automate mundane tasks
Headquartered in New York, UiPath says automation and AI provide “unprecedented opportunities” to innovate, aimed at eliminating the need for client employees to perform manual and mundane tasks.
To achieve this, UiPath focuses on providing RPA solutions that enable customers to use AI-driven business automation technology.
In November, the company unveiled new improvements to its UiPath Business Automation Platform. According to the company, the new features add value by enabling customers to transform millions of tasks and thousands of processes in their business with AI and automation.
UiPath works across a wide range of industries, including healthcare, manufacturing, insurance, financial services and more.
UiPath back on the growth path
Shortly after its April 2021 IPO, UiPath shares entered a long, sharp decline. But around the same time that PATH stock hit its lowest level in November 2022, the AI and RPA company's fundamentals began to improve – in a big way.
In the third quarter of fiscal 2023 (ended October 31, 2022) and the fourth quarter of fiscal 2023 (ended January 31, 2023), UiPath reported year-over-year earnings growth of 400%. and 200%, respectively.
The company followed with two additional quarters of triple-digit EPS gains, although these percentage gains are based on prior year quarters that showed a loss.
In UiPath's most recent report on November 30 (for the third quarter of fiscal 2024), the company generated earnings of 12 cents per share. This represents a 140% year-over-year increase.
Revenue for the quarter increased 24% to $325.9 million, marking a third quarter of accelerated growth.
PATH Stock bumpy, but gaining ground
On a daily chart, you can see how PATH stock saw a huge gap volume on December 1 following its strong earnings report the previous evening.
After rising for several days, UiPath pulled back to form its current base, an early consolidation. The new buy point is 26.52.
The stock gained about 1.4% on Wednesday, putting it a hair above its 50-day moving average. Heading into Thursday's close, PATH stock is up nearly 5% in above-average volume. It sports a strong A accumulation/distribution rating and a high/low volume ratio of 1.6.
As Palantir continues to grow in volume and industry peers like ServiceNow and Salesforce also reach record highs and flash institutional demand, see if UiPath can keep up with its own AI and automation trends on the path to 'a new breakthrough.
Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
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