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Workiva Inc (WK)
NYSE:WK
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Workiva
(NYSE:WK)
Rating:54Neutral
Price Target:―
Positive Factors
Earnings
Workiva reported solid first-quarter results that outperformed consensus estimates on most key metrics.
Market Position
Workiva shares trade at a lower multiple compared to the peer group median, with strong retention rates and improving ability to cross-sell.
Revenue Growth
Workiva finished the year on a generally solid note with the biggest revenue beat in two years and a strong guide for 20% subscription revenue growth during FY25.
Negative Factors
Profitability
FY25 profitability guidance came in light of expectations, particularly in Q1, but FY27 margin targets remain intact.
Regulatory Changes
A two-year delay in Corporate Sustainability Reporting Directive (CSRD) reporting timelines for large companies that have not yet implemented CSRD standards.
Regulatory Concerns
Concern about the fate of sustainability reporting mandates, particularly in Europe, threatens to potentially overshadow the company's reacceleration.
Workiva (WK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.74B
Dividend YieldN/A
Average Volume (3M)650.45K
Price to Earnings (P/E)―
Beta (1Y)1.04
Revenue Growth17.36%
EPS Growth32.19%
CountryUS
Employees2,873
SectorTechnology
Sector Strength76
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.14
Shares Outstanding51,888,190
10 Day Avg. Volume503,341
30 Day Avg. Volume650,454
Financial Highlights & Ratios
PEG Ratio3.45
Price to Book (P/B)-50.10
Price to Sales (P/S)0.00
P/FCF Ratio70.46
Enterprise Value/Market Cap1.15
Enterprise Value/Revenue1.49
Enterprise Value/Gross Profit7.31
Enterprise Value/Ebitda-39.05
Forecast
1Y Price Target
$99.70Price Target Upside48.45% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
Workiva Business Overview & Revenue Model
Company DescriptionWorkiva Inc. (WK) is a leading provider of cloud-based solutions that simplify complex business reporting processes. Operating primarily in the technology sector, Workiva offers its flagship platform, the Workiva platform, which is designed to help organizations streamline data collection, management, and reporting across various regulatory and compliance requirements. The platform is utilized by enterprises, government agencies, and educational institutions to improve accuracy, efficiency, and transparency in financial, regulatory, and performance reporting.
How the Company Makes MoneyWorkiva makes money through a subscription-based revenue model, where customers pay recurring fees to access its cloud-based platform and services. The company's key revenue streams include software subscriptions, professional services, and customer support. Workiva’s platform is used by organizations for SEC filings, SOX compliance, and other regulatory reporting, which drives demand for its solutions. Additionally, Workiva partners with consulting firms, advisory companies, and technology vendors to expand its reach and enhance its services, further contributing to its revenue. The company's growth is supported by its ability to upsell additional features and services to existing customers, as well as by acquiring new clients across various industries.
Workiva Key Performance Indicators (KPIs)
Any
Customers Over $100,000 Annual Contract Value
Counts the number of customers with significant annual contracts, reflecting the company's ability to attract and maintain high-value clients.
Counts the number of customers with significant annual contracts, reflecting the company's ability to attract and maintain high-value clients.
Data provided by:
Main Street Data
Main Street DataWorkiva Financial Statement Overview
Summary
Workiva demonstrates robust revenue growth and strong gross profit margins, indicating efficient cost management. However, the company faces significant profitability challenges with consistent net losses, impacting its balance sheet strength due to high debt levels and negative stockholders' equity. Operating and free cash flows are managed effectively, providing some financial flexibility, but declining cash flow trends present risks.Income Statement
Workiva has shown consistent revenue growth with a notable increase over the past years, culminating in a 5.4% revenue growth in the TTM period. However, the company is struggling with profitability, as evidenced by negative EBIT and net income margins. The gross profit margin remains strong at 76.7% for TTM, indicating effective cost management despite overall losses.65
Positive
Balance Sheet
The balance sheet reveals a challenging financial position with negative stockholders' equity for the recent periods, indicating potential financial instability. The high debt levels lead to a negative equity ratio, and the absence of positive return on equity due to ongoing losses presents concerns about future solvency and leverage management.40
Negative
Cash Flow
Workiva demonstrates strong cash flow management with positive operating cash flow throughout the periods. The free cash flow to net income ratio is favorable, indicating efficient cash utilization. However, the declining trend in operating cash flow and potential volatility in cash flows from financing activities pose risks.72
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 769.29M | 738.68M | 630.04M | 537.88M | 443.29M | 351.59M | Gross Profit |
| 590.42M | 566.63M | 475.82M | 407.99M | 339.45M | 261.42M | EBIT |
| -81.90M | -76.53M | -94.53M | -88.76M | -29.36M | -37.80M | EBITDA |
| -45.10M | -25.57M | -59.32M | -72.75M | -19.84M | -30.43M | Net Income Common Stockholders |
| -64.73M | -55.04M | -127.53M | -90.95M | -37.73M | -48.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 767.02M | 816.42M | 813.72M | 430.79M | 530.45M | 530.04M | Total Assets |
| 1.29B | 1.37B | 1.22B | 819.62M | 786.76M | 707.01M | Total Debt |
| 794.20M | 793.28M | 793.18M | 367.45M | 331.73M | 325.07M | Net Debt |
| 552.17M | 491.44M | 537.08M | 127.25M | 31.34M | 2.23M | Total Liabilities |
| 1.37B | 1.41B | 1.31B | 813.64M | 713.78M | 642.73M | Stockholders Equity |
| -75.73M | -41.68M | -89.39M | 5.98M | 72.98M | 64.28M |
| Cash Flow | Free Cash Flow | ||||
| 53.45M | 86.34M | 68.52M | 7.72M | 46.09M | 31.07M | Operating Cash Flow |
| 62.86M | 87.71M | 70.88M | 11.33M | 49.84M | 33.24M | Investing Cash Flow |
| -85.08M | -45.25M | -357.25M | -68.01M | -68.63M | -103.75M | Financing Cash Flow |
| -36.95M | 6.74M | 301.26M | -1.59M | -3.39M | 11.12M |
Workiva Technical Analysis
Negative
67.16
Price Trends
73.44
Negative
85.36
Negative
85.64
Negative
Market Momentum
-1.16
Positive
40.10
Neutral
12.28
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WK, the sentiment is Negative. The current price of 67.16 is below the 20-day moving average (MA) of 70.26, below the 50-day MA of 73.44, and below the 200-day MA of 85.64, indicating a bearish trend. The MACD of -1.16 indicates Positive momentum. The RSI at 40.10 is Neutral, neither overbought nor oversold. The STOCH value of 12.28 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WK.
Workiva Risk Analysis
Workiva disclosed 47 risk factors in its most recent earnings report. Workiva 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 1 New Risks
1.
The amount and frequency of our share repurchases may fluctuate, and we cannot guarantee that we will fully consummate our share repurchase authorization, or that it will enhance long-term shareholder value. Share repurchases could also increase the volatility of the trading price of our stock and will diminish our cash reserves. Q4, 2024
Workiva Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $4.50B | 23.14 | 189.40% | ― | 5.05% | 103.11% | |
71 Outperform | $4.25B | ― | -6.85% | ― | 20.46% | 39.37% | |
69 Neutral | $4.57B | 482.28 | 0.97% | ― | 14.52% | ― | |
67 Neutral | $4.42B | ― | -4.16% | ― | 17.70% | 61.98% | |
61 Neutral | $11.29B | 10.07 | -7.05% | 2.96% | 7.47% | -10.75% | |
54 Neutral | $3.74B | ― | 99.24% | ― | 17.36% | 32.19% |
* Technology Sector Average
Performance Comparison
WK
Workiva
67.16
-11.17
-14.26%
BOX
Box
31.09
6.05
24.16%
BILL
Bill.com Holdings
44.40
-7.50
-14.45%
INTA
Intapp
54.58
18.04
49.37%
FRSH
Freshworks
14.42
1.05
7.85%
Workiva Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: -9.72%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong performance with significant growth in subscription revenue and large contracts, as well as high customer retention and successful product innovations. However, challenges such as a cautious buying environment and flat professional services revenue were noted. While the company maintained its guidance, it reflects an awareness of potential market uncertainties.Q1-2025 Updates
Positive Updates
Strong Subscription Revenue Growth
Subscription revenue grew 20% year-over-year, and total revenue grew 17% year-over-year, beating the high end of guidance.
Expansion in Large Contracts
The number of contracts valued over $100,000 increased 23%, those over $300,000 increased 32%, and contracts valued over $500,000 were up 32% compared to Q1 of 2024.
High Customer Retention
Gross retention rate exceeded the internal target, reaching 97%, and net retention rate was 110% despite currency and Leap Year impacts.
Successful Product Innovation
New capabilities for SEC Reporting and launch of a Fund Reporting Solution for public funds were delivered in Q1.
Strong Cash Position
Cash, cash equivalents, and marketable securities were $767 million as of March 31, 2025.
Negative Updates
Cautious Buying Environment
Signs of a more cautious buying environment toward the end of Q1 due to regulatory and macroeconomic uncertainties.
Flat Professional Services Revenue
Professional Services revenue was flat compared to Q1 2024, with higher XBRL services offset by a decline in setup and consulting services.
Pressure on Net Retention Rate
Net retention rate saw pressure from foreign exchange rate headwinds and the year-over-year impact of Leap Year.
Guidance Reflects Market Uncertainty
Full-year guidance was not raised despite a strong Q1, reflecting a cautious approach due to potential persistent cautious buying environment.
Company Guidance
During Workiva's Q1 2025 earnings call, the company provided guidance for the upcoming quarter and the full fiscal year. Total revenue for Q1 reached $206 million, marking a 17% increase from the previous year, with subscription revenue specifically growing by 20% year-over-year. Although Workiva beat the high end of its revenue guidance for Q1 by $1 million, the company maintained its full-year revenue guidance of between $864 million and $868 million, reflecting cautious optimism given the macroeconomic uncertainties. Workiva expects subscription revenue to grow by approximately 20% for the full year, with a non-GAAP operating margin ranging from 5% to 5.5%. The company also highlighted a strong gross retention rate of 97% and a net retention rate of 110% for Q1. Despite signs of a more cautious buying environment, Workiva remains confident in achieving its long-term growth targets, emphasizing its competitive differentiation and the significant opportunities within its target markets, particularly in sustainability and financial reporting solutions.Workiva Corporate Events
Executive/Board ChangesShareholder Meetings
Workiva Announces Changes in Board of Directors
Neutral
Apr 4, 2025
On April 2, 2025, Brigid Bonner, a member of Workiva Inc.’s Nominating and Governance Committee and Chair of the Compensation Committee, announced she will not seek re-election as a Class II director at the company’s 2025 annual meeting. Her decision was not due to any disagreements with the company’s operations or management. The Board has approved a slate of nominees for the meeting, including a new nominee, Ms. Astha Malik, Chief Business Officer of Braze, Inc., who is expected to bring valuable skills and experience to the Board.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.