Workday (NASDAQ:WDAY) Trading 4.5% Higher Following Earnings Beat

Shares of Workday, Inc. (NASDAQ:WDAY) rose 4.5% during mid-day trading on Friday following a stronger than expected earnings report. The stock traded as high as $202.38 and last traded at $202.37. 1,834,094 shares traded hands during mid-day trading, a decline of 64% from the average session volume of 5,071,383 shares. The stock had previously closed at $193.57.

The software maker reported $2.75 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $2.61 by $0.14. Workday had a return on equity of 14.75% and a net margin of 8.60%.The business had revenue of $2.65 billion during the quarter, compared to the consensus estimate of $2.64 billion. During the same period in the prior year, the business posted $2.21 EPS. The company’s revenue for the quarter was up 12.8% on a year-over-year basis.

Key Stories Impacting Workday

Here are the key news stories impacting Workday this week:

• Positive Sentiment: Strong Q2 results: Workday reported adjusted earnings of $2.75 per share, above the $2.61 consensus estimate, while revenue rose 12.8% year over year to $2.649 billion. Subscription revenue increased 13.9% to $2.471 billion, and net income rose sharply to $632 million from $228 million a year earlier. Workday Fiscal 2027 Second-Quarter Results
• Positive Sentiment: AI adoption is supporting demand: Management said AI-related offerings accounted for more than 25% of new contract value, reinforcing the company’s positioning as an enterprise AI platform for HR, finance, and IT. Workday Q2 Earnings Call Highlights
• Positive Sentiment: Capital returns and analyst support: Workday authorized a $4 billion share-repurchase program. Following the earnings report, BMO raised its target to $230 with an “outperform” rating, while Needham raised its target to $230 with a “buy” rating; KeyCorp and Monness Crespi also lifted their targets. Analysts Revise Workday Forecasts
• Neutral Sentiment: Analyst views remain mixed: DA Davidson and Piper Sandler raised their targets to $190 but retained neutral ratings, while Cantor Fitzgerald reduced its target to $205 despite maintaining an overweight rating. This indicates optimism about valuation recovery but limited consensus on near-term upside.
• Negative Sentiment: Forward growth guidance is a concern: Workday’s fiscal 2027 revenue outlook of $9.9 billion to $10.0 billion is below the roughly $10.7 billion analyst consensus, and third-quarter revenue guidance also trails expectations. Investors are concerned that another guidance reduction could offset the quarterly beat. Workday Outlook Meets Estimates

Wall Street Analysts Forecast Growth

Several analysts have recently issued reports on WDAY shares. William Blair restated an “outperform” rating on shares of Workday in a research report on Friday. HC Wainwright set a $140.00 price objective on shares of Workday in a research note on Wednesday, May 27th. Summit Redstone set a $275.00 price target on shares of Workday in a report on Wednesday, May 27th. Canaccord Genuity Group boosted their price objective on Workday from $200.00 to $225.00 and gave the stock a “buy” rating in a research note on Tuesday. Finally, Citigroup restated a “neutral” rating on shares of Workday in a research note on Friday. Twenty research analysts have rated the stock with a Buy rating, sixteen have assigned a Hold rating and two have given a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of “Hold” and an average target price of $203.00.

Insiders Place Their Bets

In related news, insider Robert Enslin sold 5,374 shares of the stock in a transaction dated Sunday, July 5th. The shares were sold at an average price of $134.90, for a total value of $724,952.60. Following the sale, the insider owned 239,469 shares of the company’s stock, valued at $32,304,368.10. This trade represents a 2.19% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Zane Rowe sold 6,000 shares of the firm’s stock in a transaction that occurred on Tuesday, July 7th. The shares were sold at an average price of $143.70, for a total transaction of $862,200.00. Following the completion of the sale, the chief financial officer owned 288,460 shares in the company, valued at $41,451,702. The trade was a 2.04% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 875,020 shares of company stock valued at $113,938,503 over the last quarter. Insiders own 18.64% of the company’s stock.

Institutional Trading of Workday

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Rakuten Securities Inc. acquired a new stake in Workday in the second quarter worth approximately $25,000. Measured Wealth Private Client Group LLC acquired a new position in shares of Workday during the 3rd quarter valued at $26,000. JPL Wealth Management LLC bought a new stake in shares of Workday in the 3rd quarter worth $30,000. DT Investment Partners LLC bought a new position in Workday during the fourth quarter valued at about $27,000. Finally, LRI Investments LLC bought a new position in Workday during the fourth quarter valued at about $29,000. 89.81% of the stock is currently owned by institutional investors.

Workday Trading Up 4.9%

The business has a fifty day moving average of $155.95 and a 200-day moving average of $140.36. The stock has a market capitalization of $50.14 billion, a price-to-earnings ratio of 63.43, a price-to-earnings-growth ratio of 2.03 and a beta of 1.08. The company has a debt-to-equity ratio of 0.30, a current ratio of 1.01 and a quick ratio of 1.01.

About Workday

Workday, Inc (NASDAQ: WDAY) is a provider of cloud-based enterprise applications focused on human capital management (HCM) and financial management. Founded in 2005 by Dave Duffield and Aneel Bhusri following their tenure at PeopleSoft, the company develops software-as-a-service solutions that help organizations manage workforce and financial processes in a unified, cloud-native environment. Workday’s platform emphasizes continuous updates, data security, and a configurable architecture aimed at large and mid-sized enterprises.

The company’s product portfolio centers on Workday Human Capital Management and Workday Financial Management, with additional offerings for payroll, talent management, workforce planning and analytics.