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Workday, Inc. Message Board

  • michaelzara76 michaelzara76 Sep 18, 2013 9:19 AM Flag

    Valuation explained

    Negative earnings for next few years.
    Negative free cash flow for next few years.
    Shares outstanding increasing - causing more dilution.
    Insiders aggressively dumping stock.
    Market valuation is 38x Revenues (LTM) and 28x Revenues (2014).

    None of this matters in today's market. Fundamentals should be ignored. This bubble can't be stopped. Momentum traders rule the day. Special thanks to Mr. Bernanke.

    Sentiment: Hold

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    • While I agree that WDAY is very expensive by any means, people should not contemplate on shorting it. The focus on SaaS/Cloud companies are on Revenue, not Earnings. They focus on growing their presence rather than EPS, which is expected to catch up at some point (hopefully in near future). As for WDAY's business, HR is huge as everyone knows, but they are entering new verticals like Education and perhaps Financials. There are other areas they could easily disrupt given their expertise in everything SaaS/Cloud. All this might go out the window if the market sentiment turns, but other than that, not much competition out there to challenge WDAY. All that said, I wouldn't buy WDAY at these levels, but had I to already owned it, I'd keep good portion of it for at least 6 months.

      Sentiment: Hold

    • I agree with you in principle. Look at the other bubble called "social media": similar symptoms with no cash flow, huge multiples and everyday surging stock prices...and no one cares it seems. The big question is, how long do you think this charade can last? Do you think once they stop printing unlimited money and pumping the market these bubbles fall off the cliff? Or will it take a lot more than that?

    • Nice try...."Insiders aggressively dumping stock".......I explained this already.....automatic sells are NOT insiders dumping......look up the werd "Diversification"....

      Sentiment: Strong Buy

88.53+0.63(+0.72%)Apr 24 4:02 PMEDT