Atlassian (NASDAQ:TEAM) vs. Workday (NASDAQ:WDAY) Critical Survey

Workday (NASDAQ:WDAY) and Atlassian (NASDAQ:TEAM) are both large-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitability and valuation.

Institutional & Insider Ownership

89.8% of Workday shares are owned by institutional investors. Comparatively, 94.4% of Atlassian shares are owned by institutional investors. 18.6% of Workday shares are owned by company insiders. Comparatively, 37.6% of Atlassian shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Workday and Atlassian, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Workday	2	19	22	0	2.47
Atlassian	1	3	24	0	2.82

Workday currently has a consensus target price of $202.10, indicating a potential upside of 6.99%. Atlassian has a consensus target price of $209.48, indicating a potential upside of 40.97%. Given Atlassian’s stronger consensus rating and higher possible upside, analysts clearly believe Atlassian is more favorable than Workday.

Profitability

This table compares Workday and Atlassian’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Workday	12.32%	20.95%	9.22%
Atlassian	1.28%	33.53%	6.35%

Valuation & Earnings

This table compares Workday and Atlassian”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Workday	$9.55 billion	4.77	$693.00 million	$4.93	38.31
Atlassian	$6.91 billion	5.44	-$53.83 million	$0.36	412.78

Workday has higher revenue and earnings than Atlassian. Workday is trading at a lower price-to-earnings ratio than Atlassian, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Workday has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, Atlassian has a beta of 1.16, indicating that its stock price is 16% more volatile than the S&P 500.

Summary

Atlassian beats Workday on 9 of the 14 factors compared between the two stocks.

About Workday

Workday, Inc. develops cloud-based software for managing human resources, finance and business operations. Its products include Workday Human Capital Management, Workday Financial Management and Workday Adaptive Planning, which help organizations manage areas such as workforce administration, accounting, budgeting and forecasting. Founded in 2005 by Dave Duffield and Aneel Bhusri, Workday serves businesses, governments and educational institutions across a range of industries. Its operations and customer base extend across North America and international markets.

About Atlassian

Atlassian Corporation develops collaboration and productivity software for software, IT and business teams. Its products help organizations plan and track work, manage software development and support services, and share information across teams. Its product portfolio includes Jira for project and issue tracking, Confluence for team documentation and collaboration, Jira Service Management for IT and other service teams, Trello for visual work management, and Bitbucket for code collaboration. Atlassian also offers cloud-based products and tools for distributed teams.