What does the 12.6% YoY revenue growth indicate for Workday's valuation and short‑term price action?

Fundamental view:

A 12.6% YoY increase in total revenue—coupled with a 14% jump in subscription revenue—signals that Workday’s AI‑driven SaaS model is still scaling robustly in a relatively mature market. The top‑line beat comes ahead of consensus forecasts (the Street expected roughly 10‑11% growth), which tightens the valuation gap. At current levels Workday trades at roughly 7‑8 × forward FY26 revenue, which is a modest discount to its historical 8‑9 × range and still below the broader enterprise‑software median (~10 ×). The upgrade in growth therefore justifies a modest re‑rating of the multiple; a 0.5‑0.7 × lift in the EV/Revenue multiple would imply an upside of 8‑10% in the stock price absent any other catalyst.

Short‑term technical outlook:

The earnings surprise has already triggered a bullish breakout above the 50‑day SMA (~$210) and the prior resistance at $215. Volume on the post‑earnings candle was ~1.8× the 5‑day average, reinforcing the move. RSI is hovering around 58, leaving room for further upside before overbought conditions emerge. Key near‑term support sits at $210, while the next resistance cluster is $225‑$230. A typical earnings‑driven play would be to enter on a pull‑back to the 50‑day SMA with a stop just below $208 and target the $225‑$230 zone, providing a risk‑reward profile of roughly 1:2.5. If the price fails to hold the $215 breakthrough and falls back below the 50‑day SMA, the short‑term bias would shift to a corrective dip, making a tighter stop‑loss or a short‑term contrarian entry around $202 viable.