The S&P 500 has seen a remarkable 20% surge this year, driven by the rapid growth of artificial intelligence and the economy’s surprising resilience. Amidst this backdrop, two Wall Street analysts have identified UiPath and Roku as undervalued gems, predicting substantial upside potential.
Sanjit Singh at Morgan Stanley forecasts UiPath to reach $40 per share by September 2025, implying a staggering 212% increase from its current price of $12.80. Meanwhile, Nicholas Grous and Andrew Kim at Ark Invest predict Roku will soar to $605 by December 2026, representing a whopping 712% upside from its current price of $74.50.
While it’s essential to approach individual analyst predictions with caution, UiPath and Roku warrant closer examination. UiPath is a leader in robotic process automation (RPA), a rapidly expanding software market. Its platform offers task and process mining tools, enabling users to identify automation opportunities, and development tools to build software robots that can automate tasks and processes.
UiPath reported mixed Q2 results, with revenue increasing 10% to $316 million, but non-GAAP gross margin contracting 3 percentage points, and adjusted earnings falling 55% to $0.04 per diluted share. However, with co-founder Daniel Dines back at the helm, the company is poised to improve sales execution and navigate the uncertain economy.
Wall Street expects UiPath to grow sales at 10% annually through fiscal 2026, leaving room for upside given the RPA market’s projected 40% annual growth through 2030. While the current valuation of 5.2 times sales is reasonable, investors willing to hold the stock for three to five years could reap rewards.
Roku, on the other hand, connects consumers, content publishers, and advertisers through its streaming platform. The company monetizes paid content through transaction fees and ad-supported content through ad tech software sales. Roku is the leading streaming platform in the US, with its OS being the best-selling TV operating system in North America.
The company reported encouraging Q2 results, with active accounts increasing 14%, streaming hours jumping 20%, and revenue rising 14% to $968 million. Wall Street expects Roku’s revenue to compound at 13% annually through 2025, but this estimate leaves room for upside given the projected 12% annual growth in CTV ad spending.
While Ark’s price target of $605 per share may seem ambitious, Roku’s leadership in North America and expanding international presence position it for continued growth. Patient investors may find value in buying a small position today, with the potential for Roku to outperform the S&P 500 over the next three to five years.
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