Workday Stock Retreats After Disappointing Margin Forecast

So far, at least 10 brokerage firms have hiked their price target on Workday stock

Managing Editor
Sep 5, 2018 at 9:40 AM
facebook X logo linkedin


The Coca-Cola Co
The Coca-Cola Co
The Coca-Cola Co
The Coca-Cola Co
The Coca-Cola Co

Shares of Workday Inc (NASDAQ:WDAY) are down 5% at $148.90 in early trading, after the company lowered its full-year adjusted operating margin forecast by 3 percentage points. However, the software concern also posted second-quarter earnings and revenue beats, drawing a slew of analyst bull notes.

Specifically, no fewer than 10 brokerage firms hiked their price target on Workday stock, the most notable from Canaccord Genuity and Monness Crespi Hardt to $175 -- with the former saying the stock is one "growth investors could just BUY and put away." Not far behind was one to $174 at Oppenheimer. Overall analyst sentiment had been split coming into today, with 16 of 30 covering firms sporting "hold" or "strong sell" recommendations.

The tech stock has been soaring up the charts, just yesterday touching a fresh record high of $157.12. WDAY has gained over 56% since its early December lows, thanks to several sharp bounces off its 180-day moving average. Against this backdrop, it seems a near-term pullback may have been in the cards for Workday stock. The security sported a 14-day Relative Strength Index (RSI) of 83 at last night's close -- well into overbought territory.

Digging into options, traders have been leaning bullish toward Workday during the past two weeks. This is per the stock's 10-day call/put volume ratio of 2.58 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks in the 80th annual percentile. In other words, calls have been purchased over puts at a faster-than-usual clip.

Should the security resume its longer-term uptrend, shorts may be forced to cover. The 13.5 million WDAY shares sold short accounts for roughly 9.3% of the stock's total available float. At the equity's average pace of trading, it would take shorts almost two weeks to buy back their bearish bets.
 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI