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Workday
(NASDAQ:WDAY)
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Rating:72Outperform
Price Target:
$177.00
▲(30.78% Upside)
Action:Upgraded
Date:07/30/26
WDAY scores well on improving financial fundamentals—especially strong, growing free cash flow and better operating profitability—and the latest earnings call reinforced confidence via raised margin guidance and strong AI momentum. The score is held back by a still-mixed longer-term technical setup (below the 200-day average) and a demanding valuation (high P/E with no dividend yield support).
Positive Factors
Strong free cash flow generation
Workday’s cash generation is a durable strength: FCF near net income and rising operating cash flow provide recurring funding for R&D, partner investment, buybacks and debt paydown. High cash conversion supports financial flexibility and resilience across 2–6 month horizons and beyond.
Negative Factors
Revenue growth deceleration
A noticeable slowdown in top-line growth reduces runway for rapid scale and raises the bar for future upside. Slower revenue expansion constrains margin expansion and places greater reliance on upsells and efficiency gains to sustain growth rates over the coming 2–6 months.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow generation
Workday’s cash generation is a durable strength: FCF near net income and rising operating cash flow provide recurring funding for R&D, partner investment, buybacks and debt paydown. High cash conversion supports financial flexibility and resilience across 2–6 month horizons and beyond.
Read all positive factors
Workday Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue from various business segments, revealing which areas drive growth and where the company might focus future expansion efforts.
Breaks down revenue from various business segments, revealing which areas drive growth and where the company might focus future expansion efforts.
Data provided by:
The Fly
The FlyWorkday (WDAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$39.60B
Dividend YieldN/A
Average Volume (3M)4.60M
Price to Earnings (P/E)49.8
Beta (1Y)1.01
Revenue Growth13.70%
EPS Growth76.27%
CountryUS
Employees21,000
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)3.22
Shares Outstanding201,000,000
10 Day Avg. Volume3,952,389
30 Day Avg. Volume4,600,505
Financial Highlights & Ratios
PEG Ratio2.16
Price to Book (P/B)5.88
Price to Sales (P/S)4.80
P/FCF Ratio16.52
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$163.83Price Target Upside21.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering26
EPS Forecast (FY)10.77
Revenue Forecast (FY)$10.67B
Workday Business Overview & Revenue Model
Company Description
Workday, Inc. (WDAY) is an enterprise software company that provides cloud-based applications for human capital management (HCM), financial management, and planning/analytics to medium and large organizations. Its core products include Workday Hum...
How the Company Makes Money
Workday makes money primarily through recurring subscription revenue from customers that license access to its cloud applications. Customers typically pay subscription fees (often structured as multi-year agreements) based on factors such as the n...
Workday Earnings Call Summary
Earnings Call Date:May 21, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Aug 27, 2026
Earnings Call Sentiment Positive
The call highlighted strong financial results (double-digit subscription and total revenue growth), healthy backlog and retention, substantial operating and cash flow improvement, and pronounced AI momentum (big YoY growth in agentic ACV, usage metrics, and product rollouts). Key positives include raised margin guidance, active share repurchases, significant platform and international progress, and early signs that AI drives larger expansion deals. Lowlights were largely execution- and timing-related: AI monetization remains early, RPO mix/timing effects, a meaningful GAAP/non-GAAP margin gap, and the operational challenge of scaling provisioning and delivery to meet rising AI demand. Overall, the positives materially outweigh the caveats, but continued execution on AI adoption and monetization is required.Positive Updates
Strong Top-Line Revenue Growth
Subscription revenue of $2.354B, up 14% year-over-year; total revenue $2.542B, up 13%.
Negative Updates
AI Monetization Still Early
Company repeatedly emphasized AI adoption is early stage and monetization via flex credits and agent consumption is just ramping — continued execution and adoption required to convert momentum into substantial recurring revenue.
Read all updates
Q1-2027 Updates
Positive
Negative
Strong Top-Line Revenue Growth
Subscription revenue of $2.354B, up 14% year-over-year; total revenue $2.542B, up 13%.
Read all positive updates
Company Guidance
Workday reiterated fiscal 2027 guidance, forecasting subscription revenue of $9.925–$9.95 billion (growth of ~12–13%) and Q2 FY27 subscription revenue of about $2.455 billion (≈13% growth), with CRPO expected to rise 13.5–14.5% in Q2 and Q2 professional services revenue of ~$180 million; they raised FY27 non‑GAAP operating margin guidance to 30.5% (Q2 ~30%), said Q2 GAAP operating margin is ~19 percentage points lower than non‑GAAP and full‑year GAAP ~18–19 points lower, set a FY27 non‑GAAP tax rate of 19%, maintained operating cash flow guidance of $3.45 billion, forecast capital expenditures of ~$270 million, and expect free cash flow of ~$3.18 billion (≈15% growth).Workday Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
68
Positive
Cash Flow
86
Very Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.85B | 9.55B | 8.45B | 7.26B | 6.22B | 5.14B |
| Gross Profit | 7.47B | 7.23B | 6.38B | 5.49B | 4.51B | 3.71B |
| EBITDA | 1.67B | 1.36B | 1.08B | 752.00M | 206.00M | 377.00M |
| Net Income | 847.00M | 693.00M | 526.00M | 1.38B | -367.00M | 29.00M |
Balance Sheet | ||||||
| Total Assets | 16.09B | 18.07B | 17.98B | 16.45B | 13.49B | 10.50B |
| Cash, Cash Equivalents and Short-Term Investments | 4.35B | 5.44B | 8.02B | 7.81B | 6.12B | 3.64B |
| Total Debt | 3.81B | 3.82B | 3.36B | 3.30B | 3.25B | 2.10B |
| Total Liabilities | 9.41B | 10.27B | 8.94B | 8.37B | 7.90B | 5.96B |
| Stockholders Equity | 6.68B | 7.80B | 9.03B | 8.08B | 5.59B | 4.54B |
Cash Flow | ||||||
| Free Cash Flow | 2.97B | 2.78B | 2.19B | 1.91B | 1.30B | 1.38B |
| Operating Cash Flow | 3.18B | 2.94B | 2.46B | 2.15B | 1.66B | 1.65B |
| Investing Cash Flow | 953.00M | 333.00M | -1.78B | -1.75B | -2.51B | -1.61B |
| Financing Cash Flow | -4.55B | -3.32B | -1.15B | -268.00M | 1.20B | 110.25M |
Workday Technical Analysis
Positive
135.34
Price Trends
138.84
Positive
132.26
Positive
164.62
Positive
Market Momentum
9.08
Negative
66.49
Neutral
92.66
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WDAY, the sentiment is Positive. The current price of 135.34 is below the 20-day moving average (MA) of 148.93, below the 50-day MA of 138.84, and below the 200-day MA of 164.62, indicating a bullish trend. The MACD of 9.08 indicates Negative momentum. The RSI at 66.49 is Neutral, neither overbought nor oversold. The STOCH value of 92.66 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WDAY.
Workday Risk Analysis
Workday disclosed 38 risk factors in its most recent earnings report. Workday reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Workday Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $95.39B | 696.39 | 3.78% | ― | 29.54% | -21.11% | |
73 Outperform | $7.81B | 18.89 | 31.03% | 1.03% | 9.37% | 23.47% | |
72 Outperform | $39.60B | 49.80 | 10.41% | ― | 13.70% | 76.27% | |
67 Neutral | $1.84B | 71.64 | 10.84% | ― | 8.12% | -82.54% | |
66 Neutral | $101.65B | -83.32 | -57.21% | ― | 31.07% | 16.46% | |
62 Neutral | $25.63B | -121.57 | -16.70% | ― | 24.74% | 49.81% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
WDAY
Workday
170.64
-58.45
-25.51%
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TEAM
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113.32
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BL
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30.47
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DDOG
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106.75%
SNOW
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316.84
106.30
50.49%
Workday Corporate Events
Executive/Board ChangesShareholder Meetings
Workday Stockholders Back Directors, Auditor and Equity Plan
Positive
Jun 22, 2026
Workday held its Annual Meeting of Stockholders on June 16, 2026, at which holders representing about 97.58% of eligible votes were present in person or by proxy, constituting a quorum. The meeting underscored strong shareholder engagement in the ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.