Why Is UiPath Stock Skyrocketing Today?
Key Points
Last week, UiPath announced new partnerships with major AI players, including OpenAI.
The company said it will help enterprise clients make better use of OpenAI's latest models.
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Shares of UiPath (NYSE: PATH) are soaring on Monday, up 14.6% as of 2:31 p.m. ET. The jump comes as the S&P 500 and the Nasdaq Composite gained 0.4% and 0.8%, respectively.
The software and automation company announced new partnerships last Tuesday with some heavy hitters in artificial intelligence (AI), including OpenAI and Nvidia.
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UiPath hopes key partnership will drive growth
The company announced that it was teaming up with OpenAI to create a bridge that will help its existing enterprise clients better access OpenAI's latest models. The tool will help maximize AI's abilities and streamline its use by integrating it into external apps and connecting it to key data sources.
The company also announced it would team up with Nvidia to help improve fraud detection efforts in healthcare, as well as partner with Snowflake to improve the implementation of agentic AI.
Image source: Getty Images.
The stock's initial spike following the news faded last week, but it's back on the move today as OpenAI kicks off its DevDay event.
UiPath's stock is pricey
While the new partnerships are exciting, I don't think they are enough to outweigh the stock's inflated valuation. Its price-to-earnings ratio (P/E) is north of 400, making it incredibly expensive and priced for perfection. I would avoid the stock.
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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia, Snowflake, and UiPath. The Motley Fool has a disclosure policy.
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