Workiva (WK) Stock Forecast & Price Target

Workiva Inc. demonstrated a solid financial performance, with a notable gross margin increase to 79.2%, attributed to lower cloud computing costs and an enhanced customer and partner experience. The company's strong net revenue retention rate of 112% and a 22% year-over-year growth in subscription revenue highlight its ability to drive expansion and capture demand across its diverse solution offerings. Additionally, the significant growth in large contract customers and a robust pipeline of revenue from both domestic and international markets suggest a positive outlook for sustained profitability and cash flow generation.

Workiva Inc. faces a negative outlook primarily due to policy uncertainty leading to a revised lower target valuation multiple, reflecting a blended ~7.5x EV/Revenue, which indicates conservative revenue growth expectations. Although the company reported EBIT at the high end of guidance, declining year-over-year margins and ongoing investments in sustainability reporting raise concerns about future profitability and return on investment. Additionally, risks such as increased competition, challenges in cross-selling products, and uncertain returns from growth initiatives contribute to a potential downside price estimation of $61.