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Workday (WDAY) Enterprise Management Cloud Used by Salesforce

·4 min read

Workday WDAY announced that Salesforce has selected Workday Enterprise Management Cloud to expand its business reach.

Salesforce is a firm that specializes in customer relationship management and serves hundreds of thousands of customers worldwide. It plans to tap the growing demand for cloud technology in the finance and human resource (HR) domains.

Organizations are shifting to cloud-based applications, which provide greater insights, flexibility and employee experiences.

Workday, Inc. Price and Consensus

Workday, Inc. Price and Consensus
Workday, Inc. Price and Consensus

Workday, Inc. price-consensus-chart | Workday, Inc. Quote

Per a report from Grand View Research, the global finance cloud market size is anticipated to reach $101.71 billion by 2030, registering a CAGR of 20.3% from 2022 to 2030. The industry is expected to benefit as it provides a strategic platform to maintain effective control over operations and deploy cost-effective strategies, added the report.

Salesforce will combine Workday’s financial management, adaptive planning, accounting center and prism analytics, along with existing usage of Workday’s human capital management, time tracking, recruiting and payroll for the United States and Canada into a single platform to make informed decisions regarding HR and finance.

It will leverage the abovementioned platforms to streamline its procurement process and alter plans per dynamic market conditions.

Workday reported relatively healthy second-quarter fiscal 2023 results (ended Jul 31, 2022), with the bottom line and top line beating the consensus estimate. Net loss in the reported quarter was $64.2 million or a loss of 25 cents per share against net income of $105.7 million or 41 cents per share in the prior-year quarter.

Total revenues in the quarter were $1,535.8 million compared with $1,260.4 million in the prior-year quarter, driven by higher digital transformation initiatives across finance and HR domains in tune with the evolving market conditions.

The company reiterated its earlier guidance for fiscal 2023, owing to continued momentum in its business. Subscription revenues for the fiscal year are expected to be in the band of $5,537-$5,557 million, indicating growth of 22% year over year. Professional services revenues for the year are expected to be around $650 million.

However, the company’s performance is affected by stiff competition, especially in the human capital market, financial management software market and increasing costs.

Workday currently carries a Zacks Rank #4 (Sell). The stock has lost 37% in the past year compared with the industry’s fall of 60.6%.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks from the broader technology space are Cadence Design Systems CDNS, Badger Meter BMI and Arista Networks ANET. Arista Networks, Cadence Design Systems and Badger Meter currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for CDNS 2022 earnings is pegged at $4.11 per share, rising 5.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.7%.

Cadence’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 9.8%. Shares of CDNS have jumped 6.3% in the past year.

The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 6% in the past 60 days.

Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, with the average being 12.6%. Shares of BMI have lost 3.7% of their value in the past year.

The Zacks Consensus Estimate for Arista Network’s 2022 earnings is pegged at $4.04 per share, increasing 9.8% in the past 60 days. The long-term earnings growth rate is anticipated to be 18.6%.

Arista Network’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.1%. Shares of ANET have increased 39.3% in the past year.


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