The latest trading session saw Workday (WDAY) ending at $211.16, denoting a -0.98% adjustment from its last day’s close. This move was narrower than the S&P 500’s daily loss of 1.26%. Meanwhile, the Dow lost 0.86%, and the Nasdaq, a tech-heavy index, lost 1.54%.
The maker of human resources software’s shares have seen a decrease of 7.35% over the last month, not keeping up with the Computer and Technology sector’s loss of 2.39% and the S&P 500’s loss of 3.67%.
The investment community will be paying close attention to the earnings performance of Workday in its upcoming release. In that report, analysts expect Workday to post earnings of $1.40 per share. This would mark year-over-year growth of 41.41%. Simultaneously, our latest consensus estimate expects the revenue to be $1.84 billion, showing a 15.33% escalation compared to the year-ago quarter.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $5.58 per share and a revenue of $7.22 billion, indicating changes of +53.3% and +16.14%, respectively, from the former year.
Investors should also take note of any recent adjustments to analyst estimates for Workday. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, there’s been a 21.37% rise in the Zacks Consensus EPS estimate. Right now, Workday possesses a Zacks Rank of #2 (Buy).
With respect to valuation, Workday is currently being traded at a Forward P/E ratio of 38.21. This signifies a premium in comparison to the average Forward P/E of 37.43 for its industry.
It is also worth noting that WDAY currently has a PEG ratio of 1.43. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company’s expected earnings growth trajectory. Internet – Software stocks are, on average, holding a PEG ratio of 1.46 based on yesterday’s closing prices.
The Internet – Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 69, which puts it in the top 28% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Workday, Inc. (WDAY) : Free Stock Analysis Report
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