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On Wednesday, KeyBanc Capital Markets reaffirmed its positive stance on Workday (NASDAQ:WDAY) stock, maintaining an Overweight rating and a price target of $335.00, representing a significant upside from the current price of $251.50. According to InvestingPro data, analyst targets for the stock range from $250 to $360, with most analysts maintaining a bullish outlook. During a recent dinner event, analysts had the opportunity to engage with Workday’s newly appointed Chief Commercial Officer Rob Enslin and Vice President of Investor Relations Justin Furby.
The conversation with Workday’s executives left the analysts notably impressed by Enslin’s expertise in the financial sector and his insights into the company’s go-to-market strategies. This confidence appears well-founded, as InvestingPro data shows Workday maintaining strong financial health with a 75.5% gross profit margin and robust revenue growth of 16.35% over the last twelve months. Although the analysts anticipated the discussion to revolve around risks associated with the DOGE (Decentralized Online Global Economy), they were taken aback when the focus shifted to Workday’s strategic positioning and growth potential in relation to Agentic.
Despite the shift in discussion topics, Workday’s team presented a balanced view, carefully weighing the near-term risks against the long-term opportunities presented by the DOGE. The company’s evaluation of these factors suggests a measured approach to navigating the evolving market landscape. With a strong current ratio of 1.9 and more cash than debt on its balance sheet, Workday appears well-positioned to execute its strategic initiatives. For deeper insights into Workday’s financial position and growth prospects, investors can access comprehensive analysis through InvestingPro, which offers exclusive metrics and expert research reports.
Workday’s stock continues to be a topic of debate among investors, but KeyBanc sees a compelling risk-reward ratio at the current valuation. The company’s P/E ratio of 127.05 and EV/EBITDA multiple of 75.51 reflect high growth expectations, supported by projected revenue growth of 12% for the upcoming fiscal year. With Workday trading at approximately 20 times its fiscal year 2027 enterprise value to free cash flow (EV/FCF), KeyBanc views the stock’s pricing as an attractive investment opportunity.
In other recent news, Workday’s impressive earnings report has led to several analyst firms raising their price targets for the company. Scotiabank (TSX:BNS) increased its target to $355, citing strong earnings that surpassed expectations and a promising outlook for subscription revenue growth. Similarly, BMO Capital Markets raised its target to $314, highlighting Workday’s strategic focus on artificial intelligence as a potential driver for future growth. Stifel also adjusted its target to $310, acknowledging Workday’s robust fourth-quarter performance and improved operating margins. RBC Capital raised its target to $340, noting the company’s solid financial results and early adoption of AI.
Needham maintained its price target of $300, emphasizing Workday’s enhanced integration capabilities and competitiveness in the market. Workday’s recent financial achievements include a notable performance in the UK and Germany, and a projected 15% growth in subscription revenue for fiscal year 2026. The company’s focus on AI is evident, with 30% of customer expansions involving AI products. Workday’s management also anticipates an increase in non-GAAP operating margins and strong free cash flow for FY26, reflecting confidence in its growth trajectory. These developments illustrate a positive sentiment among analysts regarding Workday’s financial health and strategic direction.
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