Cisco Systems (CSCO - Get Report) showed how it can buck the market's downtrend Wednesday thanks to some positive commentary from Piper Jaffray analysts. Workday (WDAY - Get Report) stock is getting the same treatment, too, up 3.2% following an upgrade from Morgan Stanley.
Not everything is a total disaster Wednesday as this cloud-based company is getting a sharp boost from the upgrade, TheStreet's Jim Cramer said on CNBC's "Stop Trading" segment.
Analyst Keith Weiss upgraded Workday stock to overweight from equal weight and boosted his price target to $145 from $108. Despite the stock's big rally Wednesday, Weiss' new Street-high target implies almost 30% upside from current levels.
So why the upgrade? Weiss says it's likely the company can "sustain subscription revenue growth of more than 30% by holding steady" in a total addressable market worth $69 billion. That market should continue to grow about 6% annually as well, he contends.
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Weiss also says the company could top $8 billion in subscription revenue by 2025.
Analysts are forecasting total revenue of $2.13 billion in fiscal 2018, so Weiss is quite optimistic in his call. Still, though, the company's sales are projected to climb more than 35% this year. So it's possible for Workday to show big revenue results in five to seven years should it maintain a torrid pace of growth.
This would be huge if it were to achieve that level of growth, Cramer said, adding that it would make Workday one of the fastest-growing large companies in its industry behind Salesforce.com (CRM - Get Report) .
Speaking of Salesforce stock, it's been on the rebound since its late-November fall. Wednesday shares hit a new high at the open before falling. On Tuesday, the stock also hit new 52-week highs. Word on Wall Street is that the company is working on closing some very big banking contracts, said Cramer, who also manages the Action Alerts PLUS charitable trust portfolio.
Workday closed at $114.14 Wednesday, up 4.05% on the day.
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