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Workday (NAS:WDAY) Altman Z-Score

: 4.88 (As of Today)
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Good Sign:

Altman Z-score of 4.85 is strong.

Workday has a Altman Z-Score of 4.88, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

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

WDAY' s Altman Z-Score Range Over the Past 10 Years
Min: -2.03   Med: 6.15   Max: 15.8
Current: 4.85

During the past 13 years, Workday's highest Altman Z-Score was 15.80. The lowest was -2.03. And the median was 6.15.


Workday Altman Z-Score Historical Data

The historical data trend for Workday's Altman Z-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 Z-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 6.60 5.75 6.12 6.54 3.98

Workday Quarterly Data
Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23
Altman Z-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 4.29 3.27 3.85 3.98 4.48

Competitive Comparison

For the Software - Application subindustry, Workday's Altman Z-Score, along with its competitors' market caps and Altman Z-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 Z-Score Distribution

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

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



Workday Altman Z-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.

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

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*0.2889+1.4*-0.2348+3.3*-0.0033+0.6*7.3003+1.0*0.4879
=4.88

* 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 Z-Score when X4 or X5 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.
Revenue was 1684.312 + 1646.26 + 1599.103 + 1535.798 = $6,465 Mil.
Market Cap (Today) was $53,372 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=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=53371.890/7310.933
=7.3003

X5=Revenue/Total Assets
=6465.473/13252.796
=0.4879

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

Workday has a Altman Z-Score of 4.88 indicating it is in Safe Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


Workday  (NAS:WDAY) Altman Z-Score Explanation

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, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


Workday Altman Z-Score Related Terms

Thank you for viewing the detailed overview of Workday's Altman Z-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

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