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Workday Inc Class A WDAY

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Stock XNAS Rating as of
$211.45 +4.01 (1.93%)
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Company Report

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Workday Earnings: Cross Currents Yield Good Results With Lowered Fiscal 2025 Revenue Guidance

Julie Bhusal Sharma

We are lowering our fair value estimate for wide-moat Workday to $270 per share from $285 after the company posted good first-quarter results relative to our expectations but a lower revenue outlook for the year. Workday experienced pressure in Europe, lower headcount upon renewals, and increased scrutiny on larger deals during the quarter, which management expects to persist for the rest of the year. Despite a lower revenue outlook, the firm slightly raised its profitability guidance. As a result, we have lowered our growth assumptions slightly through fiscal 2026. Shares were pressured and down 11% after hours, and if the selloff persists in the next trading session, we believe shares are attractive.

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Price vs Fair Value

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WDAY is trading at a 646% premium.
Price
$211.45
Fair Value
$514.00
Uncertainty
High
1-Star Price
$829.50
5-Star Price
$478.00
Economic Moat
Bghp
Capital Allocation
Lfqzxptdbh

Bulls Say, Bears Say

Bulls

Workday’s planning and analytics solutions should take off after covid-19 has enterprises placing more importance on top-down planning. This should drive further customer and ACV growth, and thus revenue growth.

Bears

Workday’s FINS platform may not be able to increase its attach rate, moderating forecast ACV and thus revenue.

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Trading Information

Previous Close Price
$207.44
Day Range
$207.86–213.06
52-Week Range
$201.42–311.28
Bid/Ask
$211.05 / $212.20
Market Cap
$56.12 Bil
Volume/Avg
6.5 Mil / 2.6 Mil

Key Statistics

Price/Earnings (Normalized)
33.72
Price/Sales
7.48
Dividend Yield (Trailing)
—
Dividend Yield (Forward)
—
Total Yield
0.98%

Company Profile

Workday is a software company that offers human capital management, or HCM, financial management, and business planning solutions. Known for being a cloud-only software provider, Workday is headquartered in Pleasanton, California. Founded in 2005, Workday now employs over 18,000 employees.
Sector
Technology
Industry
Software - Application
Stock Style Box
Large Growth
Total Number of Employees
18,800
Website
https://www.workday.com

Competitors

Valuation

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Metric
WDAY
CRM
SAP
Price/Earnings (Normalized)
 33.7226.0831.23
Price/Book Value
 6.873.814.52
Price/Sales
 7.486.456.17
Price/Cash Flow
 24.2616.5142.50
Price/Earnings
WDAY
CRM
SAP

Financial Strength

Metric
WDAY
CRM
SAP
Quick Ratio
 1.870.951.12
Current Ratio
 1.971.111.25
Interest Coverage
 1.4847.364.75
Quick Ratio
WDAY
CRM
SAP

Profitability

Metric
WDAY
CRM
SAP
Return on Assets (Normalized)
 17.96%9.32%11.27%
Return on Equity (Normalized)
 37.52%15.06%18.79%
Return on Invested Capital (Normalized)
 23.89%12.53%15.28%
Return on Assets
WDAY
CRM
SAP
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