Truist maintains Workiva stock Buy rating, $120 price target

On Wednesday, Truist Securities expressed continued confidence in Workiva (NYSE:WK), reiterating its Buy rating and a $120.00 price target for the company’s shares. The firm’s endorsement follows Workiva’s robust fourth-quarter performance in 2024, which saw revenue and free cash flow (FCF) exceed expectations, propelled by widespread demand for its offerings. According to InvestingPro data, Workiva maintains impressive gross profit margins of 76.72% and has achieved 16.18% revenue growth over the last twelve months.

Workiva’s notable achievements in the quarter included a 22% growth in subscription revenue, which was attributed to the acquisition of new clients and the expansion of existing accounts. A significant factor in this growth was the momentum seen in multi-solution deals, with 70% of subscription revenue generated from customers who utilize multiple products from the company’s suite. While InvestingPro analysis shows the company isn’t currently profitable, analysts predict profitability this year, with an EPS forecast of $0.97 for 2024.

The demand for Workiva’s sustainability solutions was highlighted as a key driver of bookings, reflecting the company’s ability to address this growing market need. Furthermore, the company reported an increase in deal sizes and favorable win rates, which underscored the competitive strength of its product offerings.

Despite uncertainties in the macroeconomic and regulatory landscape, Workiva’s management has maintained a conservative outlook for its 2025 guidance. Nevertheless, they remain optimistic about achieving a 20% growth in subscription revenue, supported by continuous product innovation, particularly in artificial intelligence (AI).

Truist Securities believes that Workiva’s growth trajectory is surpassing market expectations, reinforcing the firm’s decision to maintain a Buy rating and a $120 price target on the company’s stock.

In other recent news, Workiva has reported its fourth-quarter 2024 earnings results, surpassing revenue expectations with a total of $200 million, compared to the forecasted $195.21 million. The company achieved a 20% year-over-year increase in total revenue, driven by strong subscription growth, which rose by 22%. Analysts at Citi responded positively to these robust results, raising their price target for Workiva shares to $130, maintaining a Buy rating. Meanwhile, BMO Capital adjusted its price target to $108, citing concerns about regulatory changes in Europe, though they upheld an Outperform rating.

Workiva’s guidance for 2025 includes a projected 20% growth in subscription revenue and a total revenue range of $864 million to $868 million. The company also aims to achieve a non-GAAP operating margin between 5% and 5.5%. Despite potential geopolitical and policy uncertainties, Workiva remains confident in its growth trajectory. The company has been expanding its product offerings, including the launch of new solutions like Workiva Carbon, which has enhanced its sustainability reporting capabilities.

Citi analysts highlighted the strength of Workiva’s growth outlook, noting the company’s ability to capitalize on opportunities in the ESG space and its expansion across multiple products. Workiva’s resilience in customer purchasing behavior, despite concerns about ESG regulations, has been a key factor in its performance. As Workiva continues to leverage growth opportunities, investors and market watchers will likely keep a close eye on its performance amidst the evolving regulatory landscape.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.