Nomura Securities Cuts Price Target on Workday (WDAY) Following 2Q16

Nomura Securities reiterated a Neutral rating on Workday (NYSE: WDAY), and cut the price target to $90.00 (from $105.00), following the company's 2Q16 earnings results. Workday reported F2Q’16 billings of $312.4mn, 5% above the consensus estimate of $296.9mn. Total revenues were posted at $282.7mn (+51.4% yoy), above consensus of $274.2mn. Billings guidance was raised for FY16 to $1.365-$1.375bn, up from $1.350-$1.365bn. Revenue guidance for FY16 was raised to $1.150-$1.158bn from prior guidance of $1.125-$1.145bn. Billings guidance for F3Q’16 was $310-$315mn, below current consensus of $337.8mn. F3Q’16 revenue was guided to $300-$303mn, in line with consensus of $301.7mn

Analyst Frederick Grieb commented, "We rate Workday Neutral with a $90 target price. We view Workday as a leading SaaS vendor given the strong quality of the company’s product offerings, high customer satisfaction ratings and seasoned leadership team. While we expect the company to deliver strong growth, given the rising tide of cloud adoption and a large addressable market, we remain Neutral rated with the shares trading at 8.2x CY16 revenues."

For an analyst ratings summary and ratings history on Workday click here. For more ratings news on Workday click here.

Shares of Workday closed at $72.40 yesterday.

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