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Workday (NASDAQ:WDAY) received a negative outlook from Cleveland Research, as the independent research firm indicated the human resources and workforce management company has recently suffered some competitive losses.
Workday was down about half a percent near noon trading on Monday.
“Signings appeared worse than expected across segments as large enterprise deals in the US appeared limited and Europe sounded softer than expected,” said Cleveland Research analyst Ari Terjanian, in a note on Monday. “On the competitive front, we continue to hear Disney (DIS) moving off of WDAY to SAP (SAP) and have also heard WDAY likely lost a major hospitality opportunity to Oracle (ORCL).”
Workday shares have declined nearly 24% over the past six months.
“Channel feedback has also pointed to incremental push from WDAY to drive business, including taking more PS deals direct, pressuring partners to lower rates, more flexible terms and discounting on software, as well as greater leniency in providing test environments to prospects,” according to Cleveland Research.
Workday is slated to announce its second quarter results after market close on Thursday. Despite surpassing expectations in Q1, the back-office software provider lowered its full-year revenue guidance to $7.7B and $7.725B, as compared to the prior range of $7.73B and $7.78B. Workday anticipated Q2 subscription revenue to be $1.895B and an adjusted operating margin of 24.5%.
A consensus estimate calls for non-GAAP earnings per share of $1.65 on revenue of $2.07B the quarter ended in July.
Workday has a Hold rating from Seeking Alpha analysts, but a Buy rating from both Wall Street analysts and Seeking Alpha’s Quant system, which routinely beats the market.
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