Workday: Multiple Compression In The Works
- Workday has traded sideways for a couple of years as multiple compression takes over.
- Investors shouldn't be fooled by high analyst price targets with the negative trend towards lower targets.
- The stock faces more multiple compression going forward that will impact price gains.
The tech sector is littered with stocks over the last couple of years that came public at excessive valuations and headed higher for awhile. The market justified these sky-high prices due to fast growth rates and a new paradigm in cloud computing or social media.
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