PATH
UiPath Inc.
$18.15
High-Growth Software
80%
Revenue × Terminal Margin DCF
Moderate
·
Conviction
Overvalued
Trading 19.9% above fair value
You pay
$18.15
Bear
$10.88
Fair
$15.14
Bull
$19.62
Bear
$10.88
-40.1%
8% rev growth, 21% terminal margin
Fair
$15.14
-16.6%
11% rev growth, 28% terminal margin
Bull
$19.62
+8.1%
15% rev growth, 32% terminal margin
Adjust Assumptions
11.0%
28.0%
12.0%
Key Value Driver
Revenue growth (11%) × margin expansion to 28%
Terminal Value % of EV
53%
Implied Market Multiple
5.1x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (24 analysts)
$13.00
Divergence from AlphaVal
16%
Summary
Projecting 11% revenue growth with FCF margins expanding from 22% to 28% over 10 years, discounted at 12%, the base-case value is $15.14 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