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Workday surges as 4Q results beat Street's view

NEW YORK (AP) -- Workday's stock extended its gains for the second day in a row on Friday as its fiscal fourth-quarter adjusted loss and revenue results topped Wall Street's expectations.

THE SPARK: On Thursday, Workday reported a fourth-quarter loss of 19 cents per share on revenue of $81.5 million. Its adjusted loss was 16 cents per share. That was less than the loss of 21 cents per share that analysts polled by FactSet expected. The analysts also expected lower revenue of $78.2 million.

THE BIG PICTURE: Workday's software helps companies keep track of payroll and other human resources functions. It competes with giant corporations in enterprise software like Oracle Corp. and SAP AG.

THE ANALYSIS: Brendan Barnicle of Pacific Crest raised Workday's price target to $70 from $60 and reaffirmed an "Outperform" price target. The analyst said in a client note that the company's strong momentum continued in its fourth quarter, with revenue up 89 percent from the prior-year period.

SHARE ACTION: Shares of Workday Inc. gained $2.26, or 3.7 percent, to $63.89 in Friday afternoon trading. The stock hit $64.73 earlier in the session, nearing the 52-week high of $65 it reached on Thursday.