WDAY – Market expectations are for Uniform ROA to reach new highs, and management is confident about Peakon, customer additions, and sales process
February 3, 2022
- Workday (WDAY) currently trades well above corporate and historical averages relative to Uniform earnings, with a 155.3x Uniform P/E (Fwd. V/E’).
- At these levels, markets are pricing in expectations for Uniform ROA to reach new highs of 31%, accompanied by 12% Uniform asset growth.
- Meanwhile, analysts expect Uniform ROA to remain at 5% levels through 2023, accompanied by 13% Uniform asset growth.
- If sustained going forward, these levels would imply a stock price closer to $31, representing significant equity downside for the firm.
- However, the firm’s most recent earnings call suggests management is confident about their Peakon acquisition, customer additions, and sales process.