Seeking Alpha Bullish Call on UiPath Clashes with DeepValue's Expansion Concerns

What happened

A Seeking Alpha article published on February 14, 2026, rates UiPath a strong buy with an $18 price target, highlighting AI-driven automation, 16% YoY revenue growth, and a pristine $1.4B cash balance. However, the DeepValue master report, based on SEC filings, shows that dollar-based net retention has declined to 107% as of October 2025 from 113% a year earlier, signaling weaker expansion within the installed base. Despite profitability improvements and robust cash flow, net-new ARR remained at $59M in Q3 FY2026, failing to accelerate meaningfully despite product launches and partnerships. Market sentiment is split between optimism over 'agentic automation' and fears that AI could substitute classic RPA use cases, with insider-selling headlines adding pressure. The critical issue is whether upcoming quarters can demonstrate that AI features lift expansion metrics, as the current narrative risks being overshadowed by stagnant growth dynamics.

Implication

UiPath's valuation hinges on proving that its AI integrations and agentic automation translate into measurable expansion, not just cost efficiency or partnership hype. The Seeking Alpha article overlooks the decline in net retention to 107%, a key risk highlighted in the DeepValue report that limits growth compounding. Without NDR rebounding to ≥110% and net-new ARR sustaining above $70M per quarter, the stock could trend toward the bear case of $9.00, despite strong cash flow and buybacks. Conversely, if Q4 FY2026 meets guidance and shows expansion improvement, the bull case up to $17.00 becomes plausible, offering asymmetric upside at current prices. Therefore, investors should maintain a cautious stance, using upcoming earnings as a checkpoint to assess whether the AI narrative is driving real monetization or merely serving as marketing.

Thesis delta

The Seeking Alpha article does not materially shift the investment thesis, which remains centered on expansion metrics rather than liquidity or profitability. If anything, it reinforces the bull scenario but underscores the gap between optimistic narratives and the reality of slowing retention. The delta is minimal; the thesis still depends on whether agentic automation can lift NDR above 110% in the next two quarters, as outlined in the DeepValue report.