Please select the second broker
Workday (WDAY) down 9% on cautious Q4 subscription guidance
Workday (WDAY) posted Q3 earnings and revenue beats on Friday, but shares closed 9% lower after the financial management software company warned of a slowdown in subscription growth in early 2021.
Before the markets opened, Workday delivered $0.86 earnings per share and $1.1bn revenue for the three months to 31st October, versus the $0.67 and $1.09bn Wall Street consensus.
However, guidance for revenue backlog growth proved to be a sticking point for investors with the 14%-16% figure offered by management falling short of the 17% forecast.
Subscription revenue was very healthy in Q3, soaring 21% to $968.5m.
Mizuho Securities analyst Siti Panigrahi said that the “cautious” guidance reflected internal concerns about rising COVID-19 cases and the expectation that it could impact new business as budgets tighten.
A conference call following the publication of the report also revealed Workday’s intentions to focus on investment and hiring in the near term, which could pressure margins.
However, the majority of analysts were happy with Workday’s numbers, with JPMorgan’s Mark Murphy revealing that he was confident in the company’s “multi-year growth potential”.
Murphy, who carries an overweight rating and $250 price target, believes that “very large established markets and a strong cloud product” bodes well for Workday’s prospects in the software industry.
Deutsche Bank, standing pat on a hold rating and $220 price target, said that it was “another solid quarter” for Workday and that the debate will largely focus on the subscription guidance for Q4.
Jefferies continued with a buy rating and $260 price target and said that it believed that the “overall environment is better than guided”.
Despite the positive sentiment from analysts, WDAY closed 9.27% lower on Friday at $209.40.
Scam Brokers, Broker Complaints
Are you aware of a scam broker or want to make a broker complaint?
We want our site users to find good brokers to trade through and to be warned off bad brokers. We encourage you to use our complaints tool to let us know about your experiences.
We have categorised the common complaints to make it easier for you and we have provided some guidance on what you may want to try before submitting a complaint, if our suggestions do not provide you with a resolution then by submitting a complaint, our team will attempt to take up your case with the relevant Broker and if needed, submit a formal report to the regulators.
We use the information you give us to decide if we want to continue to promote a broker on our site.
Your scam broker complaint not only helps you, it helps others and it helps us determine if we continue to support the broker.