With a market cap of $47.8 billion, Workday, Inc. (WDAY) is a leading enterprise platform that powers HR, finance, and IT operations with AI-driven solutions built on trusted business processes. Trusted by more than 11,500 organizations worldwide, Workday enables intelligent automation that drives measurable business outcomes.
Shares of the Pleasanton, California-based company have underperformed the broader market over the past 52 weeks. WDAY stock has decreased 15.7% over this time frame, while the broader S&P 500 Index ($SPX) has gained 19.1%. In addition, the stock has declined 10.3% on a YTD basis, compared to SPX's 13.1% return.
Looking closer, shares of the enterprise software maker have lagged behind the State Street Technology Select Sector SPDR ETF's (XLK) 41.2% surge over the past 52 weeks.
Workday has underperformed as investors worry that generative AI could disrupt its HR software business, and concerns over slower growth and the high cost of keeping pace with AI innovation have weighed on sentiment.
However, the stock rose 1% following its Q2 2027 results on Aug. 27 as revenue increased nearly 13% to $2.65 billion, slightly beating the consensus, and subscription revenue grew 13.9% to $2.471 billion. Investor sentiment improved as AI adoption emerged as a growth driver, with more than half of Q2 net new wins signing up for at least one AI solution.
For the fiscal year ending in January 2027, analysts expect Workday's EPS to grow 16.7% year-over-year to $5.38. The company's earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on another occasion.
Among the 43 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 21 “Strong Buy” ratings, three “Moderate Buys,” 17 “Holds,” and two “Moderate Sells.”
This configuration is slightly less bullish than three months ago, with 22 “Strong Buy” ratings on the stock.
On Aug. 28, Needham raised its price target on Workday to $230 and maintained a “Buy” rating.
As of writing, the stock is trading above the mean price target of $194.59. The Street-high price target of $328 suggests a 63.6% potential upside.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.