GitLab AI Security Updates: Overvalued or Undervalued?

GitLab has unveiled new product updates focusing on agentic AI and security. These include a dedicated AI gateway, a new Secrets Manager, and tools to automate vulnerability triage. This comes after strong recent stock performance, with a 30-day return of nearly 33% and a 90-day return of almost 56%. However, the one-year return is down nearly 8%. A popular narrative suggests GitLab is 24% overvalued, with a fair value of $33.61 compared to its last close of $41.67. This view considers execution risks like restructuring and slower customer growth. What's interesting is another valuation model, a DCF model, suggests GitLab is actually undervalued, with a fair value of $57.93. The bottom line here is that there are conflicting views on GitLab's true value, even with its new AI push.