Workday taking more conservative approach on outlook, says Loop Capital

Loop Capital keeps a Hold rating and a price target of $235 on Workday following the company’s Analyst Day event yesterday. Conversations with customers and partners at the event suggest that the current strength in the renewal activity will likely continue well into the second half of this year, which should drive a better product attach rate, the analyst tells investors in a research note. The firm adds however that with the new CFO in place, Workday has decided to take a more conservative approach to its 3-year financial targets, anticipating 17%-19% annual subscription revenue growth over the next three years, FY25-FY27 vs. its previous estimate of 20%+ growth from FY24 to FY26.