Wells Fargo’s Best Growth Stocks: 28 Stocks With The Highest Consensus EPS Growth Estimates

10. Workday Inc. (NYSE:WDAY)

Consensus Long-Term EPS Growth Estimate: 21%

Number of Hedge Fund Holders: 86

Workday Inc. (NYSE:WDAY) is an enterprise-focused software company that provides human resource and financial management software. This exposes the firm to the labor market as HR software typically does well when firms have adequate hiring budgets in a relaxed monetary environment. Consequently, with interest rates in the US just recently coming off of a 24-year high, it’s unsurprising that Workday Inc. (NYSE:WDAY)’s shares are down 4% year-to-date. However, the pent-up potential in the stock due to monetary constraints is also evident through the fact that since the November presidential election, the shares have gained 6.70%. Workday Inc. (NYSE:WDAY) has struggled particularly hard due to increasing costs as it posted operating losses each year between 2021 and 2023. However, improved financial performance can carry significant tailwinds, as was evident following Q2 results when the stock jumped by 12.5% after Workday Inc. (NYSE:WDAY)’s $2.085 billion revenue and $1.75 in EPS beat analyst estimates of $2.071 billion and $1.65.

Polen Capital mentioned Workday Inc. (NYSE:WDAY) in its Q3 2024 investor letter. Here is what the fund said:

“We added to several existing positions in the quarter including Adobe, Workday, Inc. (NASDAQ:WDAY), Shopify, MSCI, and Paycom Software. Workday is still growing revenue at a mid-to-high-teens rate, but in recent years, slower macroeconomic growth has made closing deals more challenging. Amidst a pullback, we increased our position as we found the valuation attractive for a well-positioned, recurring revenue business with still strong growth potential. The company also recently stated publicly that it will be focused on expanding profit margins meaningfully over the next five years—something we have expected and are pleased to see.”