Analyst Bradley Sills of Bank of America Securities maintained a Buy rating on Workday (WDAY – Research Report), retaining the price target of $285.00.
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Bradley Sills has given his Buy rating due to a combination of factors influencing Workday’s strategic direction and financial outlook. The company’s recent decision to reduce its workforce by 8.5% is seen as a strategic move to enhance profitability and focus on key areas such as AI and platform development. This restructuring is expected to help Workday optimize its investments and expand more effectively on a global scale.
Additionally, Workday’s emphasis on balanced growth aims to improve free cash flow conversion, with an anticipated growth rate higher than 26% by FY27. The decision to increase long-term margin targets indicates a stronger focus on financial health, which is further supported by the current stock valuation. Trading at a lower multiple compared to its peers, Workday’s share price does not fully reflect its growth potential, thereby justifying the Buy rating and a price objective of $285 USD.
In another report released today, JMP Securities also maintained a Buy rating on the stock with a $315.00 price target.
WDAY’s price has also changed moderately for the past six months – from $207.750 to $276.170, which is a 32.93% increase.