Workday, Inc.Short
8/22/24 - $wday - avoiding the $snow fall effect
8/22/24 :: VROCKSTAR :: WDAY
avoiding the
SNOW fall effect
- a ton of that cash is stock comp. finally people are starting to wake up to what i've been hammering for a while. stock comp matters when it's more than 100% of "free" cash flow and you're just stuck buying back your employees bags that are dumping it the moment they get it.
- i do thinkWDAY is possibly less of an offender than SNOW in this situation (on SBC) but it's still meaningful.
- 30x next year PE on 15% growth so 2x PEG? still high. 3.5% fcf gen on low teens top line growth - perhaps better than cash - but i still have other names that look better.
- 7x sales for 15% growth when co's are saying B2B is weak and we're facing an unclear macro situation in the weeks/ months ahead and with Uncle Jerome set to speak on Friday?
- I'd say any up move here is probably quite limited unless they smash. and frankly i'm not close enough to have that POV (i look at so much stuff). and any down move is probably a tough one to dip buy with conviction unless we're talking >20%. so i don't want to be stuck say... taking the L or be the first one to monetize a pop on a beat. i just avoid these situations. frankly in a normal functioning market i'd probably short it at this pt. but it's a setup that i'm comfortable watching on the sidelines.
if you're long it, you better have an edge or conviction. bc i think the market has given you a nice oppty to exit in the last two weeks including this afternoon. sometimes you don't get that luxury. think about it, okay? anon?
V
WDAYavoiding the
SNOW fall effect- a ton of that cash is stock comp. finally people are starting to wake up to what i've been hammering for a while. stock comp matters when it's more than 100% of "free" cash flow and you're just stuck buying back your employees bags that are dumping it the moment they get it.
- i do think
WDAY is possibly less of an offender than SNOW in this situation (on SBC) but it's still meaningful.- 30x next year PE on 15% growth so 2x PEG? still high. 3.5% fcf gen on low teens top line growth - perhaps better than cash - but i still have other names that look better.
- 7x sales for 15% growth when co's are saying B2B is weak and we're facing an unclear macro situation in the weeks/ months ahead and with Uncle Jerome set to speak on Friday?
- I'd say any up move here is probably quite limited unless they smash. and frankly i'm not close enough to have that POV (i look at so much stuff). and any down move is probably a tough one to dip buy with conviction unless we're talking >20%. so i don't want to be stuck say... taking the L or be the first one to monetize a pop on a beat. i just avoid these situations. frankly in a normal functioning market i'd probably short it at this pt. but it's a setup that i'm comfortable watching on the sidelines.
if you're long it, you better have an edge or conviction. bc i think the market has given you a nice oppty to exit in the last two weeks including this afternoon. sometimes you don't get that luxury. think about it, okay? anon?
V
Note
I'm short as a hedge for the rest of my book (lol mostly 
GDLC, 
NXT) at $252 AH.
congrats to the holders. no denying reality, they did beat. wasn't a crusher. but they defn beat.
not really sure why stonk is up more than 5%, a bit more on that higher gap to fill, so leaving a bit of ammo on the table. i'll relo for a bit more if we open +15% or something donky like this.
:)
V
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