As the Q4 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the finance and hr software industry, including Workiva (NYSE: WK) and its peers.
Organizations are constantly looking to improve organizational efficiencies, whether it is financial planning, tax management or payroll. Finance and HR software benefit from the SaaS-ification of businesses, large and small, who much prefer the flexibility of cloud-based, web-browser delivered software paid for on a subscription basis than the hassle and expense of purchasing and managing on-premise enterprise software.
The 14 finance and HR software stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 1.5% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 17.1% since the latest earnings results.
Workiva (NYSE: WK)
Founded in 2010, Workiva (NYSE: WK) offers software as a service product that makes financial and compliance reporting easier, especially for publicly traded corporations.
Workiva reported revenues of $199.9 million, up 19.9% year on year. This print exceeded analysts’ expectations by 2.4%. Despite the top-line beat, it was still a mixed quarter for the company with a solid beat of analysts’ EBITDA estimates but full-year EPS guidance missing analysts’ expectations significantly.
"Our Q4 results contributed to a year of accelerating growth as we executed on our strategy across financial, operational, and innovation initiatives," said Julie Iskow, President & Chief Executive Officer.
Workiva achieved the highest full-year guidance raise of the whole group. The company added 129 enterprise customers paying more than $100,000 annually to reach a total of 2,055. Still, the market seems discontent with the results. The stock is down 8.9% since reporting and currently trades at $67.01.
Is now the time to buy Workiva? Access our full analysis of the earnings results here, it’s free.
Best Q4: Workday (NASDAQ: WDAY)
Founded by industry veterans Aneel Bushri and Dave Duffield after their former company PeopleSoft was acquired by Oracle in a hostile takeover, Workday (NASDAQ: WDAY) provides cloud-based software for organizations to manage and plan finance and human resources.
Workday reported revenues of $2.21 billion, up 15% year on year, outperforming analysts’ expectations by 1.3%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ billings estimates.
The stock is down 8.9% since reporting. It currently trades at $232.50.
Is now the time to buy Workday? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Flywire (NASDAQ: FLYW)
Originally created to process international tuition payments for universities, Flywire (NASDAQ: FLYW) is a cross border payments processor and software platform focusing on complex, high-value transactions like education, healthcare and B2B payments.
Flywire reported revenues of $117.6 million, up 22.4% year on year, falling short of analysts’ expectations by 4.9%. It was a softer quarter as it posted revenue guidance for next quarter slightly missing analysts’ expectations.
Flywire delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 50.9% since the results and currently trades at $8.66.
Read our full analysis of Flywire’s results here.
BlackLine (NASDAQ: BL)
Started in 2001 by software engineer Therese Tucker, one of the very few women founders who took their companies public, BlackLine (NASDAQ: BL) provides software for organizations to automate accounting and finance tasks.
BlackLine reported revenues of $169.5 million, up 8.8% year on year. This number topped analysts’ expectations by 0.6%. Taking a step back, it was a slower quarter as it produced full-year EPS guidance missing analysts’ expectations.
The company added 10 customers to reach a total of 4,443. The stock is down 28.4% since reporting and currently trades at $45.40.
Read our full, actionable report on BlackLine here, it’s free.
Marqeta (NASDAQ: MQ)
Founded by CEO Jason Gardner in 2009, Marqeta (NASDAQ: MQ) is an innovative card issuer that provides companies with the ability to issue and process virtual, physical, and tokenized credit and debit cards.
Marqeta reported revenues of $135.8 million, up 14.3% year on year. This print beat analysts’ expectations by 3%. It was a very strong quarter as it also recorded a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ total payment volume estimates.
The stock is up 12.2% since reporting and currently trades at $3.91.
Read our full, actionable report on Marqeta here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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