Workiva (NYSE:WK) Shares Gap Down After Earnings Miss

Key Points

• Workiva shares fell sharply, opening at $71.60 versus the prior close of $85.50 after the earnings announcement, a decline of about 15%.
• Quarterly EPS was $0.72, missing the $0.80 consensus estimate, while revenue of $262.96 million topped estimates and grew 17.3% year over year.
• Analyst sentiment remained broadly positive: the stock carried a “Moderate Buy” consensus rating and an average $87 price target, with nine analysts rating it Buy.

Workiva Inc. (NYSE:WK - Get Free Report) shares gapped down prior to trading on Friday following a dissappointing earnings announcement. The stock had previously closed at $85.50, but opened at $71.60. Workiva shares last traded at $71.9680, with a volume of 192,213 shares.

The software maker reported $0.72 earnings per share for the quarter, missing the consensus estimate of $0.80 by ($0.08). Workiva had a net margin of 4.87% and a negative return on equity of 140.17%. The business had revenue of $262.96 million during the quarter, compared to analyst estimates of $261.37 million. During the same period last year, the business earned $0.55 earnings per share. The business's quarterly revenue was up 17.3% compared to the same quarter last year.

Wall Street Analyst Weigh In

A number of research firms have recently weighed in on WK. Robert W. Baird raised their price target on shares of Workiva from $95.00 to $105.00 and gave the company an "outperform" rating in a research note on Wednesday, September 16th. Citigroup reiterated a "buy" rating on shares of Workiva in a research report on Thursday, August 6th. Wall Street Zen raised shares of Workiva from a "buy" rating to a "strong-buy" rating in a research note on Sunday, October 18th. Zacks Research lowered shares of Workiva from a "strong-buy" rating to a "hold" rating in a research report on Monday, October 5th. Finally, BTIG Research set a $85.00 target price on shares of Workiva in a research note on Wednesday, September 16th. Nine investment analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, Workiva has an average rating of "Moderate Buy" and an average price target of $87.00.

Insider Buying and Selling

In other Workiva news, EVP Brandon Ziegler sold 6,571 shares of the business's stock in a transaction that occurred on Thursday, August 20th. The shares were sold at an average price of $75.97, for a total transaction of $499,198.87. Following the sale, the executive vice president directly owned 126,216 shares of the company's stock, valued at $9,588,629.52. The trade was a 4.95% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. 4.77% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Workiva

A number of hedge funds have recently modified their holdings of the business. Squarepoint Ops LLC increased its holdings in Workiva by 110.7% in the second quarter. Squarepoint Ops LLC now owns 1,247,400 shares of the software maker's stock valued at $60,511,000 after purchasing an additional 655,396 shares during the period. Arrowstreet Capital Limited Partnership lifted its holdings in Workiva by 88.5% during the 1st quarter. Arrowstreet Capital Limited Partnership now owns 1,109,646 shares of the software maker's stock worth $66,168,000 after buying an additional 520,839 shares during the period. Hawk Ridge Capital Management LP acquired a new position in Workiva during the 1st quarter worth about $65,091,000. First Trust Advisors LP grew its position in shares of Workiva by 16.4% in the 1st quarter. First Trust Advisors LP now owns 862,936 shares of the software maker's stock valued at $51,457,000 after buying an additional 121,643 shares during the last quarter. Finally, Ranger Investment Management L.P. grew its position in shares of Workiva by 11.5% in the 1st quarter. Ranger Investment Management L.P. now owns 342,185 shares of the software maker's stock valued at $20,404,000 after buying an additional 35,329 shares during the last quarter. Institutional investors and hedge funds own 92.21% of the company's stock.

Workiva Trading Down 15.0%

The stock has a market cap of $4.08 billion, a P/E ratio of 88.59 and a beta of 0.46. The business has a 50-day simple moving average of $75.92 and a 200 day simple moving average of $63.12.

About Workiva

Workiva Inc NYSE: WK provides cloud-based software designed to help organizations manage reporting, compliance, risk and other complex business processes. Its platform connects financial, operational and environmental, social and governance (ESG) data so teams can collaborate on information used for internal and external reporting.

The company's products support financial reporting, regulatory filings, audit and compliance workflows, investor communications, and sustainability reporting.

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