Workday climbed $1.26, or 1.6%, to a close of $78.89, even though the developer of cloud applications to handle payroll and other aspects of human capital management is hardly a direct comp for career-oriented social networking site LinkedIn.
"The read from investors could be that Microsoft is not allergic to doing really big acquisitions," said Wedbush analyst Steven Koenig. "That being said, Microsoft is probably going to have their hands full with this acquisition for a while."
Koenig downgraded Workday to underperform in late May, due to concerns that its human capital management business is slipping.
"Workday certainly has some challenges it is facing right now, in particular, Oracle really clamping down on keeping its Peoplesoft customer base intact and, in fact, making it very difficult for these customers to leave," Koenig said.
"Oracle can say things like, 'you won't get as favorable contract terms, licensing terms on licensing.' In some cases, they may be able to raise the total renewal bill through fine print in the contract."
While Oracle is a competitor, it would be an awkward suitor. Management formerly ran Peoplesoft, which Oracle bought in an epic hostile takeover, and the executives have a controlling stake in Workday. A spokesman did not respond to a query about whether the company would participate in software consolidation as a buyer or a seller.
"This team built Workday really with the express intent of picking up where Peoplesoft left off, but in the cloud and doing battle with Oracle," Koenig said.
Judging the fallout from the LinkedIn sale is complex because the company touches on niches from social media and career management applications to enterprise IT.
"I don't know if there is really a great comp for someone like an Oracle(ORCL) - Get Report or Salesforce(CRM) - Get Report to go out and buy to leverage the way that Microsoft is planning on leveraging LinkedIn," said Morningstar analyst Rodney Nelson. Companies like Career Builder, Monster (MWW) or Ladders are only roughly comparable.
Microsoft's acquisition of LinkedIn could cool off speculation of other deals, however. The Redmond, Wash., software group reportedly bid for Salesforce.com early last year.
"The rumors had been out there for the last 18 months or so," Nelson said, noting that Salesforce.com is more expensive than it was in early 2015. Shares of Salesforce.com dropped 34 cents, or .4%, to $81.49 on Monday.
With the $26.2 billion outlay for LinkedIn, Salesforce.com's $55 billion market cap would be hefty. Take into consideration that Chairman and CEO Marc Benioff is paying $2.8 billion for Demandware (DWRE) , making Salesforce.com an even bigger bite for Microsoft or another suitor.