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Hi Everyone,
Second time posting DD in here. If you're interested in seeing my first post it is linked [here](https://www.reddit.com/r/stocks/comments/1m3s9fm/maxlinear_mxl_a_return_to_profitability/). I posted about MaxLinear, and unfortunately didn't put my money where my mouth was, although I was very right. While it's cocky of me to think that being right once makes me a "good" investor, I'm going to try and keep my track record growing by talking about my next conviction, **UiPath (PATH)**.
**UiPath** is a Software-as-a-Service (SaaS) company that specializes in Robotic Process Automation (RPA) but has been pivoting heavily into agentic AI over the last year. In the most basic way that I can describe UiPath, the company sells enterprise software to other companies (many of which are Fortune 500). The software helps companies automate repetitive processes, such as invoicing, for example. This is not limited to specific sectors and is used by businesses ranging from healthcare to financials. Recently UiPath acquired a company called WorkFusion to strengthen its agentic AI in the financial sector.
As I'm sure many of you know, software has been heavily hammered due to AI, and UiPath hasn't seen significant growth in its share price since...well, ever. The company peaked at a **$44B market cap ($85/share) around IPO back in 2021, and it's currently around $5.7B ($11/share).** A large drop, but most definitely overextended if you ask me. For FY22, the company reported **$892M in revenue and a net loss of $(525M)**. Fast forward to today, and FY26 was vastly different. **$1.6B in revenue and a net income of $282M, and a non-GAAP FCF of $372M**. Is this NVIDIA level growth? Obviously not even close, everyone is enthralled by the AI/Memory trade currently. But when others are distracted, the door for other opportunities is wide open with no crowd clogging the door. Just like any software company, UiPath gets insane **gross margins of over 80%**.
The company is currently sitting at a **107% dollar based net retention rate**, which means that if the company failed to attract new customers, the spend of current customers increases enough to grow revenue alone without needing new customers. To clarify, 107% is a "good" number. Hyper growth companies however can easily see upwards of 130%. Even with that retention rate, the company is still attracting large customers. **From Q4 of 25 to Q4 of 26, customers with >$1M ARR increased from 317 to 357, and customers with >$100K ARR went from 2,292 to 2,565**. As previously mentioned, many of these are Fortune 500 companies, and UiPath is partnered with companies such as Anthropic, Microsoft, Salesforce, Deloitte, EY, PWC, Google, AWS (Amazon), ServiceNow, and many more.
So why has the company not moved anywhere over the last 4 years? Simply put, growth. Why invest in a company that grows 10% YoY when NVIDIA is growing 60%+? Not only that, but expectations are for UiPath's growth to slow, according to Yahoo Finance. **2027 sales growth is expected to be 9.14% and 2028 is 8.4%. The 9.14% is accurate with what UiPath is projecting 2027 revenue to be ($1.754B - $1.759B).** I usually have access to a Bloomberg Terminal through my university, but I don't over the summer, so I can't get as much info from other analysts.
So why am I invested? First, the cash this company pulls in now is significant, and for a $5.7B company to be valued like this for what it brings in is disgusting. I may not have much experience in the market since I'm only 20, but if a company is posting consistent growth but the stock price stays flat, that is a major disconnect that will be corrected at some point. The retention and stickiness that UiPath has is deeply undervalued with the 107% retention rate. Secondly, I think that it's very probable that growth can begin to accelerate this year with their agentic solutions. One quarter of surprising growth related to AI and this shit will explode the same way MaxLinear did. Third, the stickiness that UiPath has will protect it from a major pullback. This company is already deeply discounted, and it really can't fall much further with the current state of cashflows. If AI spend and buildout slows, businesses aren't going to stop using AI tools. These businesses rely heavily on these tools to maintain efficiency and won't just be able to get rid of them easily and replace them. These are entire systems built out over time. Lastly, I just like the stock. I see very little talk about it because everyone is busy fetishizing Micron, SanDisk, NVIDIA, etc.. I prefer to buy low and sell high, not buy high and sell higher.
UiPath reports Q1 2027 earnings tomorrow, Thursday the 28th, after close. I will be watching closely and listening to the call after. Expectations are $395-400M in revenue and a non-GAAP operating income of \~$80M. This will be the highest Q1 revenue on record if expectations are simply met, and the first half of the year tends to be the weaker side in terms of revenue.
**Position: 12 Calls @ $12 strike, Jan 21 2028 Expiration (these are the longest available)**
**- 2 calls were bought on 3/9/26, cost basis of $5.05, down \~17%**
**-10 calls were bought on 5/14/26, cost basis of $2.87, currently up \~46%**
**- Total dollar size: $5,040, which is 16.8% of my account**
I don't have a specific price target as I haven't built my own DCF or anything, but the AI articles that constantly pop out have been spitting out $20+, so I'm going to go with that for now. I plan on holding the calls until growth hits and price explodes or expiration. I didn't want to do what I did with MaxLinear, which is purchase shares and sell them the second I see something else more interesting. I will hold these calls and not touch them until I get my gains or expiration comes. I don't intend to add to the position either, unless some crazy ass pull back happens post earnings.
Thank you for reading, and best of luck.
[UiPath's FY2026 Presentation](https://d1io3yog0oux5.cloudfront.net/_ad3fdd1880d115021ba2f48432db15fb/uipath/db/1195/19146/presentation/UiPath_4Q-2026_Earnings-Slides-Final.pdf)