DA Davidson raised its price target for Workday to $190 from $135 while maintaining a Neutral rating, citing accelerating momentum in artificial intelligence adoption and revenue performance.
The stock, which closed at $201.56 on Tuesday, has already surpassed the new target. Workday’s shares have gained 45% over the past six months, outperforming broader software benchmarks amid robust demand for its AI-enabled enterprise solutions.
The company reported total revenue of $10.15 billion for its latest fiscal year, reflecting 13% growth. Subscription revenue exceeded expectations by approximately 0.5%, while operating margins reached 31.1%, above the consensus estimate of 30%. Gross profit margins remained steady at 76%.
Analysts at KeyBanc raised their target to $215 with an Overweight rating, while Bernstein SocGen Group increased its forecast to $238. Stifel maintained its bullish stance with a $160 target, though Cantor Fitzgerald trimmed its outlook to $205 from $220.
Workday’s AI products now account for over 25% of new annual contract value, according to Stifel’s assessment of customer adoption trends. The company’s initial guidance for fiscal 2028 suggests stronger subscription revenue growth and profitability than previously anticipated, though DA Davidson noted that updated fiscal 2027 guidance points to a softer second-half performance.
InvestingPro’s financial health rating for Workday is classified as "Good," and the stock is deemed undervalued at current levels.
