Workiva (WK) delivered a strong third-quarter update, surpassing both revenue and earnings expectations while raising its outlook for the rest of the year. The company also confirmed the appointment of a new Chief Revenue Officer to support continued growth.

Workiva’s share price has rebounded sharply in the last three months, rising nearly 21%, as upbeat quarterly results and leadership changes have helped restore some investor confidence after a tough start to the year. Even after factoring in recent momentum, the one-year total shareholder return is still down 6% and remains below its longer-term track record. However, the mix of robust growth and improved execution has started to shift sentiment in a positive direction.

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After such a strong earnings rebound and upward guidance, is Workiva’s current share price an attractive entry point for investors? Or has the market already factored in the company’s accelerating growth outlook?

Most Popular Narrative: 8.8% Undervalued

With Workiva’s most widely followed narrative placing fair value at $97.60 versus a recent close of $89, the stock is positioned as undervalued according to consensus. This assessment highlights a disconnect between strong growth projections and the current share price, inviting a closer examination of the underlying assumptions.

Workiva's focus on large contracts and multi-solution platforms, especially with major companies, aims to drive revenue via account expansion and higher contract values. Strong demand for sustainability and AI-enhanced solutions, along with global expansion efforts, is expected to boost subscription revenues and improve operational efficiencies.

Curious what assumptions justify that attractive fair value? The most popular narrative centers on rapid revenue expansion, rising profit margins, and ambitious forecasts that challenge the conventional expectations for a cloud software business. Which bold financial targets do analysts believe will transform today’s losses into tomorrow’s growth premium? Dive in to uncover the numbers and logic behind this valuation story.

Result: Fair Value of $97.60 (UNDERVALUED)

However, unexpected regulatory uncertainty in Europe or swings in global macroeconomic conditions could challenge Workiva’s growth outlook and put pressure on near-term valuations.

Build Your Own Workiva Narrative

If you see things differently or would rather dig into the numbers yourself, you can craft your own view in just a few minutes, so why not Do it your way

A great starting point for your Workiva research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.