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Workday (NAS:WDAY) Altman Z2-Score

: 1.96 (As of Today)
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Workday has a Altman Z2-Score of 1.96, indicating it is in Grey Zones. This implies that Workday is in some kind of financial stress. If it is below 1.81, the company may face bankrupcy risk.

The zones of discrimination were as such:

When Altman Z2-Score <= 1.1, it is in Distress Zones.
When Altman Z2-Score >= 2.6, it is in Safe Zones.
When Altman Z2-Score is between 1.1 and 2.6, it is in Grey Zones.

The historical rank and industry rank for Workday's Altman Z2-Score or its related term are showing as below:

WDAY' s Altman Z2-Score Range Over the Past 10 Years
Min: -6.4   Med: 1.29   Max: 4.76
Current: 1.96

During the past 13 years, Workday's highest Altman Z2-Score was 4.76. The lowest was -6.40. And the median was 1.29.


Workday Altman Z2-Score Historical Data

The historical data trend for Workday's Altman Z2-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Workday Annual Data
Trend Jan14 Jan15 Jan16 Jan17 Jan18 Jan19 Jan20 Jan21 Jan22 Jan23
Altman Z2-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -0.81 -0.95 -0.22 0.06 1.60

Workday Quarterly Data
Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23
Altman Z2-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.26 1.33 1.65 1.60 1.96

Competitive Comparison

For the Software - Application subindustry, Workday's Altman Z2-Score, along with its competitors' market caps and Altman Z2-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Workday Altman Z2-Score Distribution

For the Software industry and Technology sector, Workday's Altman Z2-Score distribution charts can be found below:

* The bar in red indicates where Workday's Altman Z2-Score falls in comparison to its industry or sector. The grey bar indicates the Altman Z2-Score's extreme value range as defined by GuruFocus.



Workday Altman Z2-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Z2-Score, also known as Z"-Score is the Z-Score for non-manufacturing companies excluding property/financial companies.

Workday's Altman Z2-Score for today is calculated with this formula:

Z=6.56*X1+3.26*X2+6.72*X3+1.05*X4_2
=6.56*0.2889+3.26*-0.2348+6.72*-0.0033+1.05*0.8127
=1.96

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z2-Score when X4_2 value is 0.

Trailing Twelve Months (TTM) ended in Apr. 2023:
Total Assets was $13,253 Mil.
Total Current Assets was $7,873 Mil.
Total Current Liabilities was $4,044 Mil.
Retained Earnings was $-3,111 Mil.
Pre-Tax Income was 6.909 + -77.919 + -22.158 + -66.867 = $-160 Mil.
Interest Expense was -28.546 + -28.549 + -29.626 + -30.16 = $-117 Mil.
Total Liabilities was $7,311 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(7873.093 - 4044.089)/13252.796
=0.2889

X2=Retained Earnings/Total Assets
=-3111.198/13252.796
=-0.2348

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-160.035 - -116.881)/13252.796
=-0.0033

X4_2=Net Worth/Total Liabilities
=(Total Stockholders Equity - Preferred Stock)/Total Liabilities
=(5941.863 - 0)/7310.933
=0.8127

The zones of discrimination were as such:

Distress Zones - 1.1 < Grey Zones < 2.6 - Safe Zones

Workday has a Altman Z2-Score of 1.96 indicating it is in Grey Zones.


Workday  (NAS:WDAY) Altman Z2-Score Explanation

The original Z-Score model was based on publicly traded manufacturing companies while the Z2-Score, also known as Z"-score can be used for any type of company excluding property/financial companies. Both Z-Score and Z2-Score describes the financial health of a company, and its likelihood of financial distress.

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4_2, Net Worth (Total Stockholders Equity - Preferred Stock)/Total Liabilities (NW/TL): it compares a company’s stock net worth with its total liabilities and can be used to assess the extent of its reliance on debt.

Read more about Altman Z2-Score, the original research on Z-Score and the additional research on Z2-Score.


Be Aware

Altman Z2-Score does not apply to financial companies.


Workday Altman Z2-Score Related Terms

Thank you for viewing the detailed overview of Workday's Altman Z2-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Workday (NAS:WDAY) Business Description

Workday logo
Traded in Other Exchanges
Address
6110 Stoneridge Mall Road, Pleasanton, CA, USA, 94588
Workday is a software company that offers human capital management, or HCM, financial management, and business planning solutions. Known for being a cloud-only software provider, Workday is headquartered in Pleasanton, California. Founded in 2005, Workday now employs over 12,000 employees.
Executives
Frederick Wayne A.i. director 500 W MAIN ST., LOUISVILLE KY 40202
David A Duffield 10 percent owner C/O WORKDAY, INC., 6230 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Michael M Mcnamara director C/O FLEXTRONICS INTERNATIONAL LTD, 2090 FORTUNE DRIVE, SAN JOSE CA 95131
Thomas F Bogan director C/O WORKDAY, INC., 6110 STONERIDGE MALL RD, PLEASANTON CA 94588
Barbara A Larson officer: Chief Financial Officer 6110 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Douglas A. Robinson officer: Co-President 6110 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Lynne M Doughtie director C/O THE BOEING COMPANY, 100 RIVERSIDE PLAZA, MC 5003-1001, CHICAGO IL 60606-1596
Michael C Bush director 6110 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Richard Harry Sauer officer: EVP, General Counsel & Secty 6110 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Ann Marie Campbell director 2455 PACES FERRY ROAD, ATLANTA GA 30339
Petros Dermetzis officer: Chief Products Officer 321 LIVORNA HEIGHTS ROAD, ALAMO CA 94507
Carl M. Eschenbach director C/O SEQUOIA CAPITAL, 2800 SAND HILL ROAD, SUITE 101, PALO ALTO CA 94025
Gomez Luciano Fernandez officer: Co-President 1A SHAWFIELD STREET,, RICHARDSON HOUSE, LONDON X0 SW3 4BA
Styslinger Lee J Iii director 2826 BALMORAL ROAD, BIRMINGHAM AL 35223
Robynne Sisco officer: Chief Financial Officer 3401 HILLVIEW AVENUE, PALO ALTO CA 94304

Workday (NAS:WDAY) Headlines

Other Sources

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