Workday price target raised to $310 from $270 at Stifel
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 26 2025
0mins
Should l Buy WDAY?
Price Target Adjustment: Stifel raised Workday's price target from $270 to $310 while maintaining a Hold rating, following the company's in-line results and positive Q4 cRPO growth.
Market Reaction and Future Outlook: The stock surged over 10% after-hours due to strong guidance for Q1 and expectations of better subscription growth in the second half, although concerns remain about the impact of AI on revenue growth.
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Analyst Views on WDAY
Wall Street analysts forecast WDAY stock price to rise
31 Analyst Rating
22 Buy
9 Hold
0 Sell
Moderate Buy
Current: 134.010
Low
235.00
Averages
275.19
High
325.00
Current: 134.010
Low
235.00
Averages
275.19
High
325.00
About WDAY
Workday, Inc. is a provider of an artificial intelligence (AI) platform to help organizations manage their people, money, and agents. The Company provides over 11,000 organizations with cloud solutions powered by AI to help solve business challenges, including supporting and empowering their workforce, managing their finances and spending in an ever-changing environment, and planning for the unexpected. It offers Financial Management, Spend Management, Human Capital Management (HCM), Planning, and Analytics applications. The Company sells its solutions worldwide primarily through direct sales. It also offers professional services, both directly and through its Workday Services Partners, to help customers deploy its solutions. It offers businesses flexible solutions to help them adapt to their industry-specific needs and respond to change. It serves various industries, including professional and business services, financial services, healthcare, education, government, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Workday Reports Strong Q4, AI Prospects Look Promising
- Strong Earnings: Workday's Q4 revenue increased by 14.5% year-over-year to $2.53 billion, surpassing analyst expectations of $2.52 billion, demonstrating resilience in the SaaS market.
- AI Solutions Growth: The new annual contract value for AI solutions doubled to $100 million in the quarter, with annual recurring revenue exceeding $400 million, indicating the growing importance of AI in its business model.
- Robust Cash Flow: The company generated $2.9 billion in operating cash flow and $2.8 billion in free cash flow for the year, reflecting strong financial health despite $3 billion in debt.
- Cautious Outlook: Management forecasts a 13% growth in Q1 subscription revenue, falling short of market expectations, with full-year revenue guidance between $9.925 billion and $9.95 billion, slightly below the $10 billion anticipated by analysts.
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- AI Solutions Growth: The new annual contract value for AI solutions doubled to $100 million in the quarter, with annual recurring revenue exceeding $400 million, indicating the growing importance of AI in its business model.
- Robust Cash Flow: The company generated $2.9 billion in operating cash flow and $2.8 billion in free cash flow for the year, reflecting strong financial health despite $3 billion in debt.
- Cautious Outlook: Management forecasts a 13% growth in Q1 subscription revenue, falling short of market expectations, with full-year revenue guidance between $9.925 billion and $9.95 billion, slightly below the $10 billion anticipated by analysts.
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- Airbnb's Unexpected Bounce: Despite missing earnings expectations, Airbnb's stock rose due to low market expectations, with projected double-digit revenue growth in 2026, showcasing resilience amid macroeconomic pressures.
- Shopify's Sustained Growth: Shopify achieved a 30% revenue increase this quarter, surpassing $100 billion in gross merchandise volume for the first time, although trading at over 150 times earnings, the market remains optimistic about its future growth potential in the e-commerce sector.
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