Workiva (WK) Stock Forecast & Price Target

Workiva Inc. demonstrated a robust financial performance, highlighted by an increase in gross margin to 79.2% year-over-year, bolstered by lower cloud computing costs and improved scale in customer engagement. The company's strong net revenue retention rate rose to 112%, alongside significant growth in large contract customers, which surged by 32% year-over-year, reflecting the company's ability to expand within its existing customer base. Additionally, Workiva's total revenue reached $200 million, marking a 20% increase year-over-year, with a promising subscription growth guidance of approximately 20% for 2025, indicating a positive trajectory and strong market demand across its diverse solution offerings.

Concerns regarding Workiva Inc.'s stock stem from uncertainties related to policy and competitive pressures, leading to a revised target valuation multiple of approximately 7.5x EV/Revenue, which reflects a downward adjustment. While the company's EBIT was reported at the high end of its guidance, indicating operational resilience, the slight year-over-year decline in margins suggests challenges in profitability amid ongoing investments for future growth. Additionally, risks associated with increased competition, difficulties in cross-selling, and uncertain returns from internal investments contribute to a negative outlook, resulting in a potential downside valuation of $61.