Workday (WDAY)
NASDAQ:WDAY
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Workday
(NASDAQ:WDAY)
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Rating:69Neutral
Price Target:
$123.00
▲(9.33% Upside)
Action:ReiteratedDate:03/07/26
The score is primarily driven by strengthening financial performance (cash flow strength and improved balance sheet), supported by a generally constructive earnings call centered on AI momentum. These positives are tempered by weak technicals (below key moving averages with negative MACD) and a rich valuation (high P/E with no dividend support).
Positive Factors
Strong free cash flow generation
Sustained, large free cash flow provides durable financial flexibility: it funds R&D and AI investments, supports continued buybacks and strategic M&A, and reduces reliance on external financing. Strong FCF also signals high earnings quality and underpins long-term capital allocation options.
Negative Factors
Guided growth moderation in FY‑27
Management's explicit slower revenue guidance reflects a structural pause as the company rebalances toward AI investment. A durable step-down in growth can reduce long-term compounding, making it harder to meet higher-duration expectations and increasing reliance on successful new-product monetization to restore faster growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow generation
Sustained, large free cash flow provides durable financial flexibility: it funds R&D and AI investments, supports continued buybacks and strategic M&A, and reduces reliance on external financing. Strong FCF also signals high earnings quality and underpins long-term capital allocation options.
Read all positive factors
Workday (WDAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$28.91B
Dividend YieldN/A
Average Volume (3M)4.99M
Price to Earnings (P/E)66.2
Beta (1Y)0.94
Revenue Growth13.35%
EPS Growth-60.76%
CountryUS
Employees20,482
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)2.47
Shares Outstanding210,000,000
10 Day Avg. Volume4,168,997
30 Day Avg. Volume4,985,644
Financial Highlights & Ratios
PEG Ratio2.11
Price to Book (P/B)5.88
Price to Sales (P/S)4.80
P/FCF Ratio16.52
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue3.37
Enterprise Value/Gross Profit4.45
Enterprise Value/Ebitda22.28
Forecast
1Y Price Target
$182.59Price Target Upside62.30% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering32
EPS Forecast (FY)10.47
Revenue Forecast (FY)$10.66B
Workday Business Overview & Revenue Model
Company Description
Workday, Inc. provides enterprise cloud applications in the United States and internationally. The company's applications help its customers to plan, execute, analyze, and extend to other applications and environments, and to manage their business...
How the Company Makes Money
Workday makes money primarily by selling subscription access to its cloud software. Customers typically sign multi-year contracts and pay recurring fees (often based on factors such as number of employees/users, enabled modules, or scope of deploy...
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 Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:May 21, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operating and financial performance with strong revenue growth, high retention, robust cash generation and notable AI product momentum (1.7B AI actions, >$400M ARR in emerging AI solutions). Management signaled substantive investments in agentic AI (Sana GA, organic agents, Flex Credits) to reaccelerate growth, and engineering productivity gains were highlighted. Near-term headwinds include a conservative FY '27 guide, the removal of a DIA one-time boost impacting Q1, elongated large-deal timing in certain markets, and a deliberate margin tradeoff as the company accelerates AI investments. Overall, the positives — particularly AI traction, strong cash flow and healthy retention — outweigh the lowlights tied mainly to timing and near-term guidance conservatism.Positive Updates
Strong Subscription and Total Revenue Growth
Q4 subscription revenue $2.360B, up 16% YoY; FY '26 subscription revenue $8.833B, up 14%. Q4 total revenue $2.532B, up 15%; FY total revenue $9.552B, up 13%.
Negative Updates
Conservative FY '27 Revenue Guidance and Near-Term Deceleration
FY '27 subscription revenue guided to $9.925B–$9.950B (growth 12%–13%), reflecting a step-down versus FY '26 growth and signaling a moderation while the company prioritizes AI investment.
Read all updates
Q4-2026 Updates
Positive
Negative
Strong Subscription and Total Revenue Growth
Q4 subscription revenue $2.360B, up 16% YoY; FY '26 subscription revenue $8.833B, up 14%. Q4 total revenue $2.532B, up 15%; FY total revenue $9.552B, up 13%.
Read all positive updates
Company Guidance
Workday guided FY‑2027 subscription revenue of approximately $9.925–$9.950 billion (up 12%–13%), Q1 subscription revenue of about $2.335 billion (≈13% YoY), and expects cRPO to increase 14.5%–15.5% in Q1 with subscription revenue up roughly 5% sequentially in Q2; FY professional services revenue is pegged at ≈$710 million (Q1 ≈$180M). They forecast a FY non‑GAAP operating margin of ~30% (Q1 30.5%), expect Q1 GAAP operating margin to be ~19 points below non‑GAAP and full‑year GAAP ~18–19 points below, a FY non‑GAAP tax rate of 19%, FY operating cash flow of ~$3.45 billion, capex of ≈$270 million, and free cash flow of ~$3.18 billion (≈15% growth). Management noted the DIA contract added nearly one point to Q4 subscription growth and will not recur in Q1, signaled an accelerated pace of AI investment (with Flex Credits consumption ramping into the back half), and said these investments aim to reaccelerate growth while preserving medium‑term subscription targets.Workday Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
80
Positive
Cash Flow
86
Very Positive
| Breakdown | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 9.55B | 8.45B | 7.26B | 6.22B | 5.14B |
| Gross Profit | 7.23B | 6.38B | 5.49B | 4.51B | 3.71B |
| EBITDA | 1.36B | 1.08B | 752.00M | 206.00M | 377.00M |
| Net Income | 693.00M | 526.00M | 1.38B | -367.00M | 29.00M |
Balance Sheet | |||||
| Total Assets | 18.07B | 17.98B | 16.45B | 13.49B | 10.50B |
| Cash, Cash Equivalents and Short-Term Investments | 5.44B | 8.02B | 7.81B | 6.12B | 3.64B |
| Total Debt | 3.82B | 3.36B | 3.30B | 3.25B | 2.10B |
| Total Liabilities | 10.27B | 8.94B | 8.37B | 7.90B | 5.96B |
| Stockholders Equity | 7.80B | 9.03B | 8.08B | 5.59B | 4.54B |
Cash Flow | |||||
| Free Cash Flow | 2.78B | 2.19B | 1.91B | 1.30B | 1.38B |
| Operating Cash Flow | 2.94B | 2.46B | 2.15B | 1.66B | 1.65B |
| Investing Cash Flow | 333.00M | -1.78B | -1.75B | -2.51B | -1.61B |
| Financing Cash Flow | -3.32B | -1.15B | -268.00M | 1.20B | 110.25M |
Workday Technical Analysis
Negative
112.50
Price Trends
139.98
Negative
175.82
Negative
204.17
Negative
Market Momentum
-6.87
Positive
27.64
Positive
8.35
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WDAY, the sentiment is Negative. The current price of 112.5 is below the 20-day moving average (MA) of 128.55, below the 50-day MA of 139.98, and below the 200-day MA of 204.17, indicating a bearish trend. The MACD of -6.87 indicates Positive momentum. The RSI at 27.64 is Positive, neither overbought nor oversold. The STOCH value of 8.35 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
71 Outperform | $6.17B | 19.61 | 26.06% | 0.94% | 9.72% | -2.69% | |
69 Neutral | $28.91B | 66.22 | 7.97% | ― | 13.35% | -60.76% | |
65 Neutral | $37.17B | 438.37 | 3.24% | ― | 26.63% | -46.13% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $15.13B | -250.38 | -13.32% | ― | 19.51% | 53.35% | |
55 Neutral | $41.87B | -48.84 | -60.27% | ― | 28.48% | -19.12% | |
54 Neutral | $1.80B | 168.71 | 6.57% | ― | 7.36% | -40.62% |
* Technology Sector Average
WDAY
Workday
112.50
-119.84
-51.58%
PAYC
Paycom
113.59
-102.92
-47.54%
TEAM
Atlassian
57.15
-143.84
-71.57%
BL
BlackLine
30.29
-15.76
-34.22%
DDOG
Datadog
105.37
13.49
14.68%
SNOW
Snowflake
121.11
-23.44
-16.22%
Workday Corporate Events
Executive/Board Changes
Workday Grants CEO Aneel Bhusri New Equity Package
Positive
Mar 6, 2026
On February 6, 2026, Workday’s board appointed co‑founder and Executive Chair Aneel Bhusri as chief executive officer, and on March 5, 2026, he received a substantial equity package under the 2022 Equity Incentive Plan tied to his new ...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Workday Reinstates Co-Founder Aneel Bhusri as CEO
Positive
Feb 9, 2026
On February 6, 2026, Workday’s board appointed co-founder and executive chair Aneel Bhusri as chief executive officer, returning him to the role he previously held for multiple terms since 2009 and keeping him on as chair. The move coincided...
Business Operations and Strategy
Workday Announces Workforce Restructuring and Related Impairment Charges
Negative
Feb 4, 2026
On February 4, 2026, Workday detailed plans to trim roughly 2% of its workforce—mainly non-revenue roles in Global Customer Operations—while continuing targeted hiring across strategic, revenue-generating areas, signaling a pivot towar...
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.