WDAY

By Dean Seal

Shares of Workday Inc. rose 12% to $160.44 Wednesday as Wall Street analysts reacted positively to the company's performance in the third quarter despite strengthening macroeconomic headwinds.

The company said after the bell Tuesday that its top line surged to $1.60 billion from $1.33 billion a year ago, reflecting strong continued demand for its enterprise cloud applications for finance and human resources.

JP Morgan analysts said in a note that the results demonstrate "relative resilience and stability in a tough macro environment," noting that finance and HR solutions remain a high priority in the current labor market.

The results show Workday selling back to its own customers, who are continuing to consolidate on the platform, according to DA Davidson analysts Robert Simmons and Lucky Schreiner.

"Overall, the customer base motion and medium enterprise are driving Workday's ability to maintain healthy growth as the economy continues to be uneven," the DA Davidson analysts said in a note Wednesday.

Workday also announced Tuesday that its directors have approved a share repurchase program with an authorization of up to $500 million, with the hope of reducing the impact of future share dilution from employee stock issuances.

Analysts at Mizuho Securities view the buyback program positively, saying in a note that it demonstrates management's confidence in the business and validates the view that Workday's shares are currently undervalued.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

November 30, 2022 11:58 ET (16:58 GMT)

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