Workday, Inc. (WDAY) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Workday, Inc.

Updated on October 12, 2026 · accounts published on August 27, 2026

Reading of October 9, 2026: A software business turning profitable at record margins, still paying heavily in shares

Workday trades at a P/E of 37.4 over the last 12 months, 7 % above its sector median of 35.0, after the stock fell 22 % in a year.

• Is Workday expensive or cheap? Workday's P/E of 37.4 sits 7 % above the 35.0 sector median, with the stock 24 % below its 52-week high.
• How is the business doing? Operating margin reached 10.7 % in fiscal 2026, the highest in 12 years, against a −9.1 % average since 2015.
• How strong is the balance sheet? Cash exceeds debt by $5.77 per share in fiscal 2026, with an Altman Z of 3.5 in the safe zone and Piotroski at 8 of 9.
• What to expect from the next earnings? Analysts expect EPS of $2.74 on November 24, 2026, after Workday beat estimates in 8 of the last 8 quarters.
• Is Workday growing with real cash or by diluting shareholders? Stock-based pay took 17 % of revenue in fiscal 2026, well above the 10 % healthy line for tech, near the 20 % toxic mark.

Is Workday expensive or cheap?

Over the last 12 months Workday trades at a P/E of 37.4, a 7 % premium to the median of 361 technology peers at 35.0. The earnings yield is only 2.9 %, while the free cash flow yield reaches 11.5 %, so the business generates far more cash than reported profit. EV/EBITDA of 31.1× is a fraction of its five-year average of 120.6×, a comparison inflated by years of thin earnings. After a 22 % fall in 12 months, the stock sits 24 % below its 52-week high of $245.67.

How is the business doing?

Workday has moved from losses to profits. The operating margin averaged −9.1 % across fiscal 2015-2026, and fiscal 2026 closed at 10.7 %, the best of those 12 years; over the last 12 months it stands at 12.0 %. Revenue grew 13 % and EPS 32 % year on year, so profit is rising more than twice as fast as sales. ROIC of 11.4 % over the last 12 months beats the sector median of 8.1 % by 3.3 points, yet it did not clear 10 % in any fiscal year from 2017 to 2026. The improvement is real but recent.

How strong is the balance sheet?

Workday ended fiscal 2026 with $20.83 of cash per share against $15.06 of debt, a net cash cushion of $5.77 that equals 3.1 % of the share price. Debt-to-equity of 0.58 over the last 12 months is moderate, and an Altman Z of 3.5 places the company in the safe zone. A Piotroski score of 8 out of 9 points to fundamentals improving on almost every test. The soft spot is liquidity: a current ratio of 0.91 means short-term liabilities slightly exceed short-term assets, something to watch given how much cash sits on the books.

What to expect from the next earnings?

On August 27, 2026, Workday reported EPS of $2.75 against $2.61 expected, a 5.4 % beat that extends a streak of 8 beats in 8 quarters. For the quarter due on November 24, 2026, analysts expect $2.74, roughly flat with the last print. The 2027 EPS consensus has barely moved in 27 days, from $11.07 to $11.09 across 23 analysts, and revenue estimates are equally steady. Of 81 analysts, 41 rate the stock a buy, 37 a hold and 3 a sell, a divided vote after a 22 % slide over 12 months.

Is Workday growing with real cash or by diluting shareholders?

In technology, generic ratios miss the point: growth, pricing power and dilution from share-based pay matter more than the P/E. Workday's gross margin of 76 % in fiscal 2026 clears the 70 % bar for software, free cash flow reached 29 % of revenue against a 20 % healthy mark, and the Rule of 40 scores 43, elite territory. The cost is stock-based pay at 17 % of revenue, which helps explain why cash runs so far ahead of profit. Revenue per share grew 14.4 % a year over fiscal 2023-2026, just short of 15 %, and net debt of 1.7× EBITDA exceeds the 1.5× tolerated for software.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.