Mizuho analyst Siti Panigrahi downgraded shares of UiPath Inc.
PATH,
Wednesday in the wake of the software company’s latest earnings report. He wrote that he was “encouraged” by UiPath’s “go-to-market (GTM) repositioning to enterprise/C-Suite,” but he sees various risks to the business. In particular, Panigrahi noted that “the reorganization’s focus on delivering profitability, and potential macro deterioration and enterprise-oriented product alignment” could pressure growth in annual recurring revenue. “While the guidance de-risks 2H, we expect the shares to remain range-bound near-term until the company makes progress on strategic repositioning,” he wrote. UiPath’s “strategy to focus more on enterprise will take some time to play out, especially in an uncertain macro environment with strong exposure to Europe and competitive threats from ServiceNow…and Microsoft,” Panigrahi continued, adding that he has “not yet seen enterprises prioritize automation in a potential recessionary environment.” The stock is down more than 20% in premarket trading Wednesday.
