GTLB vs. PEGA: Which Enterprise Automation Stock Is a Better Buy Now?

GitLab GTLB and Pegasystems PEGA are major players in the enterprise automation space, each offering distinct platforms that help organizations streamline software development and business operations. GitLab streamlines software development workflows through DevOps automation, while Pegasystems delivers AI-powered low-code workflow automation and decision-management software.

Per the Grand View Research report, the global autonomous enterprise market size was estimated at $49.25 billion in 2024 and is expected to register a CAGR of 16.2% from 2025 to 2030. Both Gitlab and PEGA are likely to benefit from the significant growth opportunity highlighted by the rapid pace of growth.

GTLB or PEGA — Which of these enterprise automation stocks has the greater upside potential? Let’s find out.

The Case for GTLB

GitLab is benefiting from strong demand for its DevSecOps platform. Its solutions, such as GitLab Ultimate, Dedicated, and GitLab Duo, play a significant role in driving customer adoption and expanding existing customer relationships. 

Gitlab’s expanding clientele and market leadership in the DevSecOps platform category are contributing to its growth prospects. In the first quarter of fiscal 2026, customers with more than $5K of Annual Recurring Revenue (ARR) increased to 10,104, up 13% year over year. Customers with more than $100K of ARR increased to 1,288, up 26% year over year, demonstrating GTLB’s ability to attract and retain large enterprise customers.

Gitlab’s expanding portfolio has been a major growth driver. In the first quarter of fiscal 2026, GitLab announced the general availability of GitLab 18, featuring major innovations across core DevOps workflows, security and compliance, and AI capabilities natively integrated into the platform. GitLab Duo Workflow, a secure agentic AI, which is in beta, is expected to improve GitLab’s footprint across the SDLC.

The Case for PEGA

Pegasystems is benefiting from strong demand for its GenAI Blueprint solution, which is an agent that uses AI to combine the company’s best practices, as well as clients’ and partners’ knowledge, to design enterprise workflow applications. More than 1,000 new Blueprints are being created every week, more than double from a few months ago.

PEGA’s Gen AI blueprint is being widely adopted by tech giants like Accenture, Cognizant, Infosys, Capgemini, TCS, and Wipro for client engagements. In the second quarter of 2025, PEGA saw a 16% year-over-year rise in ACV to $1.51 billion, driven by strong demand for Pega GenAI Blueprint. 

Pega’s expanding portfolio has been noteworthy. In June 2025, PEGA announced Powered by Pega Blueprint, a solution enabling system integrators to integrate their own intellectual property and industry expertise into Pega’s AI-driven workflow designer. This helps partners deliver faster, more customized enterprise transformation and drive greater client success.

Price Performance and Valuation of GTLB and PEGA

In the year-to-date period, GitLab shares have lost 16.4% while Pegasystems shares have appreciated 23.5%. The underperformance of GitLab can be attributed to challenging macroeconomic uncertainties and increased competition in the AI-enabled DevSecOps platform.

The increase in PEGA’s shares can be attributed to its expanding portfolio and the growing popularity of its Gen AI Blueprint.

GTLB and PEGA Stock Performance

Image Source: Zacks Investment Research

Valuation-wise, GTLB and PEGA shares are currently overvalued as suggested by a Value Score of F.

In terms of the forward 12-month Price/Sales, GitLab shares are trading at 7.55X, which is higher than PEGA’s 5.68X.

GTLB and PEGA Valuation

Image Source: Zacks Investment Research

How Do Earnings Estimates Compare for GTLB & PEGA?

The Zacks Consensus Estimate for GTLB 2025 earnings is pegged at 75 cents per share, which has remained unchanged over the past 30 days, indicating a 1.35% rise year over year.

GitLab Inc. Price and Consensus

GitLab Inc. price-consensus-chart | GitLab Inc. Quote

The Zacks Consensus Estimate for PEGA’s 2025 earnings is pegged at $1.84 per share, which has declined 1.2% over the past 30 days, indicating a 21.85% increase year over year.

Pegasystems Inc. Price and Consensus

Pegasystems Inc. price-consensus-chart | Pegasystems Inc. Quote

GTLB’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, delivering an average surprise of 37.64%. PEGA’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, delivering an average surprise of 66.66%. The average surprise of PEGA is higher than that of GTLB.

Conclusion

While both GitLab and Pegasystems are poised to benefit from enterprise automation growth, PEGA currently offers stronger momentum, higher earnings growth, and broader adoption of its GenAI solutions.

Despite GTLB’s strong growth, AI-powered DevSecOps platform, and solid partnerships, the company faces challenges from one-time expenses, such as the global Summit event and ongoing costs related to its China joint venture, Jihu, which add pressure to its margins. 

Currently, PEGA sports a Zacks Rank #1 (Strong Buy), making the stock a stronger pick than GTLB, which has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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