Workday price target lowered to $325 from $335 at KeyBanc

KeyBanc lowered the firm’s price target on Workday (WDAY) to $325 from $335 and keeps an Overweight rating on the shares. The firm notes Workday reported Q1 revenue slightly above and operating margin well above the Street. That said, while headline cRPO growth of 15.6% is solidly ahead of consensus of 15.1%, it notably includes 0.5 points of contribution from ST tenant contracts, which were not previously included in the cRPO definition or guidance. Similarly, the Q2 cRPO growth guide of 15%-16% includes a 1-point contribution from tenants, vs. consensus of 14.9%, a slight miss on an apples-to-apples basis. Given macro uncertainty, management noted it is “keeping an eye on” SLED and International markets, though has not seen any direct impact yet, KeyBanc adds.