The shares of UiPath (NYSE:PATH), which develops software that facilitates automation, are tumbling today. The company’s first-quarter revenue outlook was significantly below analyst estimates, causing PATH stock to 20%. A number of analysts became more bearish on the shares in the wake of the company’s guidance.
UiPath’s Results and Guidance
UiPath reported a fiscal Q4 per-share loss of 12 cents, while analysts were expecting a loss of 7 cents. On the other hand, its Q4 revenue jumped 39% year-over-year to $289.7 million, versus the mean estimate of $283 million.
However, UiPath provided Q1 revenue guidance between $223 million and $225 million, compared with analysts’ average estimate of $247 million. For all of fiscal 2023, the company provided sales guidance of $1.075 billion to $1.085 billion, while analysts, on average, had expected $1.17 billion.
In a statement included in the company’s Q4 press release, UiPath CEO Daniel Dines explained that, given the company’s presence in Eastern Europe and the departure of its chief revenue office at the end of April, “We… believe it is prudent at this time to factor both our European exposure and go-to-market leadership transition into the financial outlook we are providing.”
Analysts Became More Bearish on PATH Stock
Mizuho slashed its price target on UiPath to $40 from $70. The firm predicts that the name will be “range bound” until the invasion of Ukraine eases, but it is still bullish on the firm’s “long-term growth potential,” The Fly reported.
Oppenheimer cuts its price target on the company to $35 from $56. The firm blamed the company’s disappointing guidance on both “macro and internal sales leadership/execution.” Oppenheimer, however, kept an “outperform” rating on the stock.
More pessimistic on PATH stock was RBC Capital, which reduced its price target on the name to $32 from $37. UiPath’s guidance was negatively impacted by both “macro uncertainty” and the imminent departure of the company’s chief revenue officer, according to RBC. The firm sees “investors taking a more wait-and-see approach” toward the stock going forward, and it kept a “perform” rating on the name.
According to TipRanks, the average rating on analysts on the stock is “strong buy,” while their mean price target is $40.79.
On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.