Financial statement analysis and common stock valuation

Income Statement
Quarterly Data

The income statement (statement of earnings) reports on the performance of Workday Inc., the result of its operating activities.

Enterprise Value to FCFF (EV/FCFF)

Free cash flow to the firm is the cash flow available to the Workday Inc. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.

• Free Cash Flow to The Firm (FCFF)
• Interest Paid, Net of Tax
• EV to FCFF Ratio, Current
• EV to FCFF Ratio, Historical

Capital Asset Pricing Model (CAPM)

CAPM is a theory concentrated with deriving the expected rates of return on risky assets based on the assets’ systematic risk levels. Systematic risk is the variability of returns that is due to macroeconomic factors that affect all risky assets. It cannot be eliminated by diversification.

• Rates of Return
• Variance and Covariance
• Systematic Risk (β) Estimation
• Expected Rate of Return

Common-Size Income Statement

Income statement components (revenues and expenses) shown as percentage of total sales.

Analysis of Short-term (Operating) Activity Ratios

Evaluates revenues and output generated by the Workday Inc. assets. Operating performance ratios describe the relationship between the Workday Inc. level of operations and the assets needed to sustain operating activities.

• Short-term Activity Ratios (Summary)
• Receivables Turnover
• Payables Turnover
• Working Capital Turnover
• Average Receivable Collection Period
• Average Payables Payment Period

Analysis of Short-term (Operating) Activity Ratios
Quarterly Data

Evaluates revenues and output generated by the Workday Inc. assets. Operating performance ratios describe the relationship between the Workday Inc. level of operations and the assets needed to sustain operating activities.

• Short-term Activity Ratios (Summary)
• Receivables Turnover
• Payables Turnover
• Working Capital Turnover
• Average Receivable Collection Period
• Average Payables Payment Period

Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
Quarterly Data

Liabilities and stockholders’ equity components shown as percentage of total liabilities and stockholders’ equity.

Income Statement

The income statement (statement of earnings) reports on the performance of Workday Inc., the result of its operating activities.

Common-Size Balance Sheet: Assets

Assets components shown as percentage of total assets.

Price to FCFE (P/FCFE)

Free cash flow to equity is the cash flow available to Workday Inc. equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made.

• Free Cash Flow to Equity (FCFE)
• P to FCFE Ratio, Current
• P to FCFE Ratio, Historical

Common Stock Valuation Ratios

Relative valuation technique determine the value of Workday Inc. by comparing it to similar entities (like industry or sector) on the basis of several relative ratios that compare its stock price to relevant variables that affect the stock value, such as earnings, book value, and sales.

• Current Valuation Ratios
• Historical Valuation Ratios (Summary)
• Price to Earnings (P/E)
• Price to Operating Profit (P/OP)
• Price to Sales (P/S)
• Price to Book Value (P/BV)

Enterprise Value (EV)

Enterprise value is total company value (the market value of common equity, debt, and preferred equity) minus the value of cash and short-term investments.

• Current EV
• Historical EV