Workday: A Market Leader Only For The Long Term

  • Workday is market-leading in cloud HCM software, with 45% of the Fortune 500 as clients.
  • It has successfully expanded into financials, planning, and analytics, which keeps growth in the mid-20s, and there are still plenty of opportunities, especially internationally.
  • However, given the high level of stock-based compensation and related dilution, the company isn’t profitable on a GAAP basis, and its GAAP EPS is actually trending down.
  • There isn’t much operational leverage yet, so we feel investors need a fairly long time horizon.

Source: Workday: A Market Leader Only For The Long Term – Workday, Inc. (NASDAQ:WDAY) | Seeking Alpha