PATH
UiPath Inc.
$13.71
High-Growth Software
80%
Revenue × Terminal Margin DCF
Mild
·
Conviction
Fair Value
Trading 13.3% below fair value
You pay
$13.71
Bear
$11.10
Fair
$15.82
Bull
$20.67
Bear
$11.10
-19.0%
8% rev growth, 21% terminal margin
Fair
$15.82
+15.4%
12% rev growth, 28% terminal margin
Bull
$20.67
+50.8%
15% rev growth, 32% terminal margin
Adjust Assumptions
12.0%
28.0%
12.0%
Key Value Driver
Revenue growth (12%) × margin expansion to 28%
Terminal Value % of EV
53%
Implied Market Multiple
3.6x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (24 analysts)
$15.13
Divergence from AlphaVal
5%
Summary
Projecting 12% revenue growth with FCF margins expanding from 22% to 28% over 10 years, discounted at 12%, the base-case value is $15.82 per share.
Warnings
Gross margin of 83% means each dollar of revenue is highly profitable. As the company grows, overhead costs should shrink as a share of revenue, boosting overall profits.
Key Risks
- Current FCF misleads — the model values future margins, not today's cash
- SBC dilution is the hidden tax: 2-4% annual share growth compounds fast
- Revenue deceleration is inevitable — the question is when and how steep