Workday Inc. (NASDAQ:WDAY)

The financial ratios exhibit notable trends that provide insight into the valuation dynamics over the observed periods.

Price to Earnings (P/E) Ratio

The P/E ratio data is largely missing for the early periods; however, from January 31, 2022 onward, it shows a dramatic decrease from extremely high values initially around 2418.34 and 1957.29 down to a more moderate range in later periods. Specifically, from April 30, 2024 to July 31, 2025, the P/E stabilizes between 37.68 and 130.49, with a downward trend after peaking at 130.49. This suggests that the company’s earnings improved relative to its stock price in recent quarters or that the stock price adjusted downward relative to earnings.

Price to Operating Profit (P/OP) Ratio

The P/OP ratio is absent in earlier periods and becomes available starting January 31, 2024, where it begins at a very high value of 4065.25 and subsequently declines sharply to approximately 112.1 by July 31, 2025. The consistent reduction indicates improving operating profits in relation to stock price or an adjustment in stock valuation. Despite high initial ratios, the decline implies operational profitability has become more aligned with market valuation.

Price to Sales (P/S) Ratio

The P/S ratio exhibits a decrease from the earlier quarters in 2020 where it ranged between 11.23 to 15.28, down to a trough between 6.19 and 7.33 in 2022. Post-2022, there is a mild recovery and stabilization around the 7 to 9 range, showing some volatility but no clear upward or downward directional trend. This pattern implies that the stock price has become relatively more attractive regarding sales generation over time, followed by a slight moderation in valuation.

Price to Book Value (P/BV) Ratio

The P/BV ratio displays a clear downward trend from a high around 20.36 early in the observed timeline to levels close to 6.44 by July 31, 2025. There is a noticeable decrease especially between 2021 and 2022, after which the ratio fluctuates modestly but remains below earlier highs. This decline may indicate that the market valuation relative to the company's book value has become more conservative or that book value has increased faster than market capitalization.

Overall, the data reflects a transition from extremely high valuation multiples in earlier periods—a common feature in growth-oriented companies—towards more moderated valuations in recent quarters. Both profitability-based ratios (P/E and P/OP) show marked declines, suggesting profitability improvements or market reassessments. Sales and book value based multiples indicate a reduction in premium valuations relative to historical levels, potentially signaling a maturing phase in the company’s financial performance or market perception.

The share price exhibited considerable fluctuations over the observed period. From April 2020 to January 2022, the price showed an overall upward trend with some volatility, peaking near 299.09 US$ in October 2021 before declining sharply in early 2022. Following this decline, there was a recovery phase leading to a new peak of 264.32 US$ by January 2024, though it subsequently retreated somewhat by mid-2025.

Earnings per share (EPS) experienced a notable turnaround during the timeline. Initially negative and improving consistently from -2.22 US$ in April 2020 to a positive 0.12 US$ in January 2022, it then fell back into negative territory during late 2022 and early 2023. A strong recovery phase started by mid-2023, culminating in a significant jump to 6.09 US$ by January 2025, followed by a moderate reduction yet maintaining positive EPS through July 2025.

The price-to-earnings (P/E) ratio data is sporadic but reveals periods of extremely high values, especially in early 2022 where ratios exceeded 1900, indicating potentially inflated valuations relative to earnings or temporary distortions due to near-zero earnings. More recent P/E ratios from early 2024 to mid-2025 decline substantially to a range between approximately 37 and 130, pointing to more normalized valuation levels, yet still elevated compared to typical market averages. This corresponds with the significant positive EPS gains in that period.

Share Price Trends

A volatile upward movement was observed until late 2021, followed by a decline and subsequent recovery periods through to mid-2025, with considerable fluctuations.

Earnings per Share (EPS)

EPS shifted from significant losses in 2020 towards breakeven and positive territory by early 2022, with a dip again in 2022-2023, and a strong positive growth phase from mid-2023 onward.

P/E Ratio Patterns

Extremely high P/E ratios in early 2022 indicate valuation stress or low earnings values, with later ratios stabilizing yet remaining relatively high in line with the improved earnings profile by 2024-2025.

Overall, the financial data reveals a company transitioning from losses toward profitability, with associated market price and valuation shifts reflecting investor sentiment and earnings improvements. The substantial EPS growth in the latter periods implies enhanced operational performance or earnings quality, while the elevated but more stable P/E ratios suggest cautious investor optimism about sustained profitability.

Over the analyzed period, the share price exhibited notable fluctuations, with an initial rise followed by a significant decline and then a recovery trend towards the end of the timeline. The share price peaked near 299 US$ around October 2021, then dropped substantially to levels close to 143 US$ by October 2022. Subsequently, the share price showed a positive upward trend, reaching above 260 US$ in some recent quarters before a modest decline to approximately 221 US$ by July 2025.

Operating profit per share followed a general trajectory of improvement over the same timeline. Early in the period, the values were negative, indicating losses per share, but there was a consistent trend towards decreased losses, turning positive around October 2023. From this point, operating profit per share showed steady growth, indicating improved operational efficiency and profitability.

Operating profit per share (US$)

Started at -2.23 US$ and showed a gradual increase, moving into positive territory at 0.06 US$ in October 2023. Growth continued steadily reaching as high as 1.97 US$ by July 2025.

Price to Operating Profit ratio (P/OP)

This ratio was unavailable in earlier periods but appears from October 2023 onwards. The P/OP started extremely high, at over 4000 in October 2023, then sharply decreased over the subsequent quarters to a range between approximately 112 and 163 by July 2025. This suggests an initial market undervaluation relative to operating profits, with a subsequent adjustment as profitability improved and share prices stabilized.

The data indicate that the company experienced operational challenges reflected in negative operating profits initially, which impacted investor perception as illustrated by the fluctuating share price. However, strengthening profitability has contributed to increased investor confidence and valuation, as seen in the rising share price in the latter part of the series and the normalization of the P/OP ratio.

Share Price Trends

The share price exhibited notable volatility over the observed periods. Initially, the price increased from $182.56 to peak near $299.09 in October 2021, followed by a substantial decline to a low of $143.30 by October 2022. Subsequently, a recovery trend emerged, with the price rising back above $260 by January and October 2024 before moderating slightly towards $221.27 in July 2025. This pattern suggests fluctuating investor sentiment and potential market reactions to company performance or broader economic factors during this timeframe.

Sales Per Share Development

A consistent upward trajectory is evident in sales per share, progressing steadily from $16.26 in April 2020 to an anticipated $33.55 by July 2025. This steady increase reflects continuous growth in revenue generation on a per-share basis, indicating improving operational performance or top-line expansion without substantial fluctuations.

Price-to-Sales (P/S) Ratio

The P/S ratio demonstrates considerable variation across the timeline. Initially, it peaked at 15.28 in October 2021, corresponding with the share price peak during this period. Post this peak, the ratio declined sharply to around 6.19 by October 2022, coinciding with the share price drop despite ongoing growth in sales per share. In the subsequent periods, the P/S ratio partially recovered but remained below earlier highs, fluctuating between approximately 6.59 and 9.61. This indicates that although sales per share increased steadily, the market valuation relative to sales became more conservative, potentially reflecting changed market expectations or valuation recalibrations.

Overall Insight

The data reveals robust underlying sales growth without interruption, contrasted by share price and valuation metrics that have experienced significant cyclical variation. The divergence between rising sales per share and fluctuating P/S ratios and share prices suggests external factors influencing market valuation independent of fundamental revenue improvements. Generally, after a peak in late 2021, the market's valuation approach has become more reserved despite continuous operational growth, indicating a shift in investor perception or external market conditions affecting the stock’s risk and return profile.

The analysis of the quarterly financial data reveals several notable trends in share price, book value per share (BVPS), and the price-to-book value (P/BV) ratio over the observed period from April 2020 through July 2025.

Share Price

The share price exhibited significant volatility throughout the timeframe. Starting at $182.56 in April 2020, it reached a peak of $299.09 in October 2021, indicating a strong upward movement in that interval. This was followed by a considerable decline to a low of $143.30 in October 2022. Post this decline, the share price generally recovered, peaking again at $264.32 in January 2024, then experiencing a downward trend with fluctuating values ending at $221.27 in July 2025. The movements indicate periods of high market optimism and subsequent corrections.

Book Value Per Share (BVPS)

BVPS demonstrated a steady and consistent increase across the entire span, rising from $11.07 in April 2020 to $34.35 in July 2025. There were no periods of decline, reflecting ongoing growth in the company's net asset value per share. This upward trend is indicative of sustained accumulation of equity and efficient retention of earnings.

Price-to-Book Value (P/BV) Ratio

The P/BV ratio showed a noticeable decline over the observed periods. Initially, the ratio was at a high level of 16.49 in April 2020, suggesting the market priced the shares at a significant premium relative to their book value. This ratio peaked at 20.36 in July 2020 but then trended downward sharply, reaching a low of 6.44 in July 2025. The decreasing P/BV ratio indicates a reduction in market valuation relative to the book value, possibly reflecting market repricing or increased investor caution despite the rising book value per share.

Overall, the data portrays a scenario where fundamental book value has grown steadily, but market price has experienced volatility with a tendency toward lower premiums relative to book value in recent periods. This might suggest changing market perceptions about the company's growth prospects or risk profile. The persistent reduction in the P/BV ratio, alongside strong growth in BVPS, points to an increasingly conservative market valuation paradigm compared to the earlier high valuations observed.