William Blair analyst Matthew Pfau has maintained their bullish stance on WDAY stock, giving a Buy rating today.
Matthew Pfau has given his Buy rating due to a combination of factors surrounding Workday’s recent financial performance and future outlook. Workday’s fourth-quarter subscription revenue slightly exceeded expectations, and while the non-GAAP operating income was marginally better, the company also affirmed its fiscal 2025 subscription revenue guidance, projecting a healthy growth rate. Moreover, the projected increase in non-GAAP operating margin for fiscal 2025 suggests operational efficiency and profitability. Despite the post-hours stock price dip, these elements indicate a steady and reliable growth trajectory for Workday.
Pfau’s optimism is also underpinned by the belief that Workday’s strategic decisions and investments are aligning the company for an upturn when the broader market conditions improve. The current valuation of the stock, after the aftermarket sell-off, appears attractive to Pfau, who sees a significant upside potential over the next year. He emphasizes that while the macroeconomic headwinds for enterprise SaaS may limit immediate upside, Workday’s positioning primes it for growth, particularly through free cash flow (FCF) expansion and maintaining a stable revenue multiple.
In another report released today, Jefferies also maintained a Buy rating on the stock with a $350.00 price target.
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Workday (WDAY) Company Description:
Based in California and founded in 2005, Workday, Inc. provides enterprise cloud applications for finance and human resources worldwide. It delivers financial management, human capital management, and analytics applications designed for companies, educational institutions, and government agencies.
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