How To Research A Stock From Scratch: UiPath

TL;DR

Research UiPath from scratch by applying an investing checklist and examining SEC filings, investor presentations, recent financial reports, and news before judging the business. On September 16, 2021, the review identified PATH as a recurring-revenue automation software company with 81% sales growth, an 82% gross margin, and negative free cash flow. Read on for the findings behind this early investment assessment.

Transcript

is uipath ticker symbol path a good investment i don't know but we're going to find out in about an hour on this series brian stouffel and i took a stock that we don't know well and we research it live you're going to watch us dig into sec filings look at investor presentations dig into the most recent financial reports and look at news to figure o... Read More

Key Insights

• ✋ UIPath is a market leader in automation software with high revenue growth and impressive customer retention.
• 👤 The company's focus on user-friendly automation tools and customer engagement contributes to its competitive edge.
• 🤨 UIPath successfully raised capital through an IPO, highlighting investor confidence in the company's potential.
• 🌸 Financial metrics show both growth opportunities and challenges for UIPath, including ongoing losses despite revenue increases.

Questions & Answers

Q: Is UiPath stock a good investment?

The excerpt does not reach a final investment verdict. It begins an evaluation of UiPath using an investing checklist and notes both promising indicators, including 81% sales growth and an 82% gross margin, and risks such as a lack of GAAP profitability and negative free cash flow.

Q: How do you research UiPath stock from scratch?

The presenters examine SEC filings, investor presentations, recent financial reports, and news, then organize their findings with an investing checklist. They also plan to calculate quality and anti-fragile scores before deciding whether UiPath may be investible.

Q: What does UiPath do?

UiPath provides an end-to-end platform that uses software robots to automate tasks people perform in software. Its platform is designed for employees across a company and supports use cases ranging from simple repetitive tasks to long-running, complex business processes.

Q: What is UiPath's ticker symbol?

UiPath's ticker symbol is PATH. At the time of the review on September 16, 2021, the stock was trading at about $54 and the company had a market capitalization of roughly $28 billion.

Q: How does UiPath generate revenue?

UiPath generates revenue from licenses for its proprietary software, maintenance and support, and professional services. The presenters describe it as a software business with recurring revenue while questioning how much of its model is SaaS versus licensing.

Q: What did UiPath's financial metrics show?

The review cites 81% sales growth in the latest fiscal year and an 82% gross margin. UiPath was not profitable on a GAAP basis, and its free cash flow was negative, so the early financial picture combined rapid growth with ongoing losses.

Q: How had UiPath stock performed since its IPO?

UiPath began trading in April at about $72 and was around $54 during the September 16, 2021 review. The presenters therefore marked it as having not beaten the market and described the shares as down substantially.

Q: Who competes with UiPath in automation software?

The competitors shown during the research include Microsoft, Automation Anywhere, and Kryon. The presenters also cite the Forrester Wave as positioning UiPath as the clear leader in the software-robot category.

Summary & Key Takeaways

• Investigated UIPath's financial data, revenue streams, and market presence.

• Explored its unique position in the automation industry and competitive advantages.

• Assessed the potential for investment based on financial metrics.