Symbotic (NASDAQ: SYM) and UiPath (NYSE: PATH) both help companies streamline tasks and cut costs by automating tasks with artificial intelligence (AI). Symbotic processes pallets and cases in large warehouses with its automated robots and software, while UiPath plugs its AI algorithms into a company’s software to automate repetitive jobs like entering data, processing invoices, and onboarding customers.
Both stocks have gone on wild rides since their public debuts. Symbotic went public by merging with a special purpose acquisition company (SPAC) in June 2022. Its stock opened at $10.54 on the first day and soared to record high of $63.54 on July 31, 2023, but it now trades at about $44.
UiPath went public at $56 in an initial public offering (IPO) in April 2021, hit its all-time high of $85.12 a month later, but is now worth just $22.
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Investors have clearly been more bullish on Symbotic than UiPath, but is the former still a better investment than the latter? Let’s take a fresh look at both AI stocks to decide.
Investors shouldn’t ignore Symbotic’s biggest challenges
Symbotic claims a $50 million investment in just one of its modules (which include its robots and software) can generate $250 million in lifetime savings for warehouse operators over a 25-year period. Its two biggest backers are SoftBank, which owns the SPAC that Symbotic initially merged with, and Walmart.
Symbotic’s top customer is also Walmart, which accounted for 88% of its revenue in fiscal 2023 (which ended last September). Its other major customer is GreenBox, a new warehouse-as-a-service joint venture it set up with SoftBank last year. The company’s heavy dependence on its biggest backers is worrisome, but it’s gradually diversifying its customer base with new deals with Target, Albertsons, and C&S Wholesale.
Symbotic’s revenue soared 136% in fiscal 2022 and grew another 98% to $1.18 billion in fiscal 2023. It also narrowed its loss under adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) from $90 million to $18 million.
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