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Workday (WDAY) has been under pressure recently, with the stock down 4% over the past day and 10% over the past week, extending a decline of 14% over the past 3 months.
See our latest analysis for Workday.
Looking beyond the latest move, Workday’s share price has been under pressure for some time, with the year to date share price return down 43.18% and the 1 year total shareholder return down 50.91%. This points to fading momentum as investors reassess growth and risk.
If Workday’s pullback has you rethinking your watchlist, this could be a useful moment to broaden your search and check out 20 top founder-led companies
With Workday now trading well below recent levels and showing an intrinsic discount of about 62% against one valuation estimate, the key question is whether this signals an undervalued stock or whether the market is already pricing in its future growth potential.
Most Popular Narrative: 31.7% Undervalued
Against Workday’s last close of $116.93, the most widely followed narrative anchors on a fair value estimate of $171.14. This frames the recent share price slide as a sizable discount that hinges on how its earnings and AI driven growth story unfold.
Broad adoption of Workday’s AI-enabled HR and finance products (with >70% of customers using Workday Illuminate and >75% of net new deals including at least one AI product), along with acquisitions like Paradox and Flowise, is fueling cross-sell/upsell activity, increasing average contract values and bolstering future topline growth.
Want to see how this AI adoption thread turns into a $171 per share fair value for Workday, anchored on specific revenue, margin, and earnings assumptions that the narrative spells out but the market is clearly questioning right now?
Result: Fair Value of $171.14 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, Workday’s story could still be knocked off course if faster moving AI powered rivals pressure pricing, or if higher compliance and investment costs squeeze margins more than expected.
Find out about the key risks to this Workday narrative.
Another View on Workday’s Valuation
The earlier fair value discussion for Workday leaned heavily on future cash flows and AI driven growth. A simpler price based check tells a more cautious story, with the stock trading on a P/E of 34.1x versus 23.3x for peers and 25.5x for the wider US Software industry, even though its fair ratio is estimated at 37.4x.
That mix of a richer P/E than peers but still below the fair ratio suggests a tug of war between perceived upside and valuation risk. Which side of that trade off do you think the market will resolve in the long run?
See what the numbers say about this price — find out in our valuation breakdown.
NasdaqGS:WDAY P/E Ratio as at Jun 2026 Next Steps
If this mix of pressure and potential around Workday leaves you unsure, consider acting while sentiment is shifting and weigh the positives for yourself with 3 key rewards.
Looking for more investment ideas beyond Workday?
Workday’s recent volatility does not have to define your next move. Broaden your opportunity set by using focused stock lists that match your risk and return preferences.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include WDAY.
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