Workday stock holds steady as Stifel maintains $255 price target

Investing.com - Workday (NASDAQ:WDAY), a prominent player in the software industry with a market capitalization of $58.5 billion, maintained its Hold rating from Stifel, which reiterated its $255.00 price target following the company’s Analyst Day event in San Francisco. According to InvestingPro data, the company maintains strong financial health with a "GOOD" overall rating.

Workday shares rose approximately 5% in after-hours trading following the Analyst Day and the announcement of a $2 billion investment from activist investor Elliott.

During the event, Workday management highlighted its AI innovation initiatives, long-term growth opportunities, and the ongoing evolution of its business model, while addressing investor concerns about potential AI disruption to its business.

The company outlined a multi-scenario financial target framework based on macroeconomic conditions, guiding FY28 annual subscription revenue growth of 13-14% (including M&A) in its mid-case scenario, compared to last year’s FY27 guidance of 15%.

Stifel viewed the updated guidance positively despite the effective reduction, noting it resets expectations to more achievable levels and creates room for a potential beat-and-raise pattern in future quarters.

In other recent news, Workday has been the focus of several analyst updates following its annual Rising customer conference and Analyst Day in San Francisco. Cantor Fitzgerald reiterated its Overweight rating with a price target of $265, highlighting Workday’s competitive advantage in enterprise AI adoption, which relies on its key HR and Finance data. BMO Capital maintained an Outperform rating and a price target of $285, noting positive developments such as AI-centric innovation and new partnerships, as well as the acquisition of Sana. TD Cowen adjusted its price target from $310 to $290 but kept a Buy rating, citing a reset in Workday’s medium-term growth expectations. Needham also reiterated a Buy rating with a $300 target, despite Workday lowering its near-term subscription revenue growth guidance from 15% to approximately 13% for FY27. Bernstein SocGen Group maintained an Outperform rating with a $304 price target, emphasizing Workday’s innovation and execution strategies. These updates reflect a mix of confidence and caution among analysts regarding Workday’s growth potential and strategic initiatives.

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