Workday initiated with an Outperform at RBC Capital

RBC Capital analyst Rishi Jaluria initiated coverage of Workday with an Outperform rating and $275 price target. The analyst believes there is a “long runway” of 20%-plus subscription growth for Workday, driven by the continued displacements of legacy solutions, a large expansion opportunity following a successful evolution into a multi-product platform, and an “underappreciated M&A engine,” coupled with a clear path to 30%-plus margins long term. Workday has successfully evolved into a multi-product platform, the analyst tells investors in a research note.