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Why the Market Dipped But Workday (WDAY) Gained Today

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The latest trading session saw Workday (WDAY - Free Report) ending at $246.76, denoting a +1.23% adjustment from its last day's close. The stock's performance was ahead of the S&P 500's daily loss of 0.05%. Meanwhile, the Dow experienced a drop of 0.02%, and the technology-dominated Nasdaq saw an increase of 0.18%.

Heading into today, shares of the maker of human resources software had lost 0.52% over the past month, lagging the Computer and Technology sector's gain of 3.5% and the S&P 500's gain of 2.76% in that time.

Analysts and investors alike will be keeping a close eye on the performance of Workday in its upcoming earnings disclosure. The company is forecasted to report an EPS of $1.72, showcasing a 12.42% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $2.13 billion, up 13.98% from the year-ago period.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $6.97 per share and revenue of $8.39 billion. These totals would mark changes of +19.35% and +15.6%, respectively, from last year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Workday. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

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, the Zacks Consensus EPS estimate has moved 0.21% higher. At present, Workday boasts a Zacks Rank of #1 (Strong Buy).

Investors should also note Workday's current valuation metrics, including its Forward P/E ratio of 34.99. This represents a premium compared to its industry's average Forward P/E of 32.36.

We can additionally observe that WDAY currently boasts a PEG ratio of 1.67. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. WDAY's industry had an average PEG ratio of 2.19 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 57, this industry ranks in the top 23% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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