Dayforce (DAY) came out with quarterly earnings of $0.61 per share, beating the Zacks Consensus Estimate of $0.52 per share. This compares to earnings of $0.48 per share a year ago.
DAY's second-quarter 2025 results are likely to benefit from an expanding clientele and a strong portfolio.
Shares of Dayforce no longer look appealing as valuation multiples against peers have compressed. I'm downgrading the stock to a neutral rating. The company faces the risk of falling interest rates as well as declining headcount levels at many U.S. companies, hurting its seat-based software and payroll products. The stock's ~5x forward revenue and ~15x forward adjusted EBITDA multiples are now fairly priced for its prospects.
Dayforce Inc. (NYSE:DAY ) Q1 2025 Earnings Conference Call May 7, 2025 8:00 AM ET Company Participants David Niederman - Vice President, Investor Relations David Ossip - Chief Executive Officer Jeremy Johnson - Chief Financial Officer Conference Call Participants Siti Panigrahi - Mizuho Securities Scott Berg - Needham & Company Mark Marcon - Baird Mark Murphy - JPMorgan Kevin McVeigh - UBS Samad Samana - Jefferies Raimo Lenschow - Barclays Jared Levine - TD Cowen Steven Enders - Citigroup Ryan Krieger - Wolfe Research Brad Reback - Stifel Daniel Jester - BMO Capital Markets Zane Meehan - KeyBanc Capital Markets Bhavin Shah - Deutsche Bank Michael Turrin - Wells Fargo Allan Verkhovski - Scotiabank Operator Greetings, and welcome to the Dayforce First Quarter 2025 Earnings Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded.
The headline numbers for Dayforce (DAY) give insight into how the company performed in the quarter ended March 2025, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.
Dayforce (DAY) came out with quarterly earnings of $0.58 per share, beating the Zacks Consensus Estimate of $0.56 per share. This compares to earnings of $0.43 per share a year ago.
Get a deeper insight into the potential performance of Dayforce (DAY) for the quarter ended March 2025 by going beyond Wall Street's top -and-bottom-line estimates and examining the estimates for some of its key metrics.
Dayforce (DAY) has been upgraded to a Zacks Rank #2 (Buy), reflecting growing optimism about the company's earnings prospects. This might drive the stock higher in the near term.
I give a buy rating for Dayforce due to its accelerating enterprise expansion and AI innovations, positioning it for continued growth. Enterprise expansion is driving larger deal sizes, higher contract values, and better revenue visibility, with a shift towards larger customers. AI innovations like Co-Pilot and demand forecasting tools enhance DAY's platform stickiness, increasing spend per customer and retention rates.
Dayforce's stock fell ~8% after a weakly received 2025 outlook, creating a buying opportunity, with shares now trading at an attractive price near $67. Despite a deceleration in revenue growth, Dayforce's constant currency growth is 15.5-17.0%, with management expecting 15% long-term growth and 100-150bps EBITDA margin expansion. Dayforce's Q4 revenue grew 16% y/y, beating expectations, with core recurring revenue up 20% y/y and sales cycles normalizing, boosting confidence in future targets.
DAY fourth-quarter 2024 results benefit from an innovative portfolio and robust recurring revenue growth.
Dayforce Inc. (NYSE:DAY ) Q4 2024 Earnings Conference Call February 5, 2025 8:00 AM ET Company Participants David Niederman - Vice President, Investor Relations David Ossip - Chair and Chief Executive Officer Jeremy Johnson - Executive Vice President and Chief Financial Officer Steve Holdridge - President and Chief Operating Officer Joe Korngiebel - Executive Vice President and Chief Strategy, Product, and Technology Officer Conference Call Participants Siti Panigrahi - Mizuho Securities Mark Murphy - JPMorgan Chase Raimo Lenschow - Barclays Mark Marcon - Robert W. Baird Samad Samana - Jefferies Scott Berg - Needham & Company Steve Enders - Citi Kevin Mcveigh - UBS Alex Zukin - Wolfe Research Brad Reback - Stifel Operator Greetings and welcome to Dayforce's Fourth Quarter and Full Year 2024 Earnings Call.