We recently published a list of 10 Best Big Data Stocks To Buy Now. In this article, we are going to take a look at where Workiva Inc. (NYSE:WK) stands against the other big data stocks.
The global big data market is on a rapid growth trajectory, projected to reach $103 billion by 2027, more than doubling its size from 2018. This explosive growth is driven by the increasing reliance on data to inform business decisions, optimize operations, and unlock new revenue streams. According to Statista, the software segment, in particular, is poised to dominate, accounting for 45% of the market by 2027. Big data, characterized by its massive volume, high velocity, and wide variety, presents both opportunities and challenges. Traditional data processing tools struggle to handle the scale and complexity of modern data sets, which have been expanding rapidly due to the surge in mobile data traffic, cloud computing, and the integration of technologies like artificial intelligence (AI) and the Internet of Things (IoT). These factors have contributed to the rise of big data as a critical asset for businesses across industries. As the data landscape evolves, advanced analytics tools such as predictive analytics and data mining have become essential for extracting valuable insights from vast datasets.
The rise of the Internet of Things (IoT) has led to a surge in connected devices, generating enormous amounts of data that necessitate advanced big data solutions for effective processing and analysis. Cloud computing enhances the big data market by offering scalable and cost-efficient storage and processing capabilities, enabling businesses to handle large data volumes with ease. Technological advancements in big data are continually enhancing the management and analysis of vast datasets, making these processes more accessible and practical. This progress supports the growing trend of data-driven decision-making, where companies increasingly rely on data insights to make informed choices, optimize operations, and secure a competitive edge. Additionally, big data analytics helps organizations uncover hidden patterns and customer trends, fostering innovation and allowing for the development of products and services that adapt to evolving market demands, underscoring the vital role of big data in today’s competitive landscape.
Investment in big data technologies is also driven by stringent data privacy and security regulations. Compliance with laws like the General Data Protection Regulation (GDPR) in Europe and the California Consumer Privacy Act (CCPA) in the U.S. is becoming mandatory for businesses. These regulations require robust data handling practices, pushing companies to implement advanced big data solutions that ensure data privacy and security. Enhanced measures such as secure storage and data privacy protocols build trust with consumers and stakeholders. Moreover, the need for effective data governance frameworks is accelerating the adoption of sophisticated big data technologies. These solutions facilitate comprehensive data management, including tracking data lineage, maintaining data integrity, and conducting regular audits. Emphasis is placed on integrating encryption, anonymization, and real-time monitoring tools to prevent data breaches and unauthorized access. Continuous investment in big data technologies is crucial for businesses to meet evolving compliance requirements, thereby driving the market’s growth.
According to a report by Verified Market Reserach, North America is projected to remain a leader in the big data market, driven by key industries such as finance, healthcare, and e-commerce. In the financial sector, Big Data analytics plays a crucial role for banks, investment firms, and insurance companies by providing deeper insights into customer behavior, detecting fraudulent activities, and evaluating risk. By analyzing extensive data sets, including transaction histories, market trends, and customer demographics, financial institutions can uncover patterns and anomalies that aid in making informed decisions and managing risks. Predictive analytics models further enhance market trend forecasts, optimize investment strategies, and improve portfolio management, contributing to greater profitability and competitive edge in the financial sector.
In healthcare, Big Data analytics significantly improves patient care, reduces costs, and advances medical research. Healthcare providers use Big Data to analyze electronic health records (EHRs), medical imaging, and genomic data to tailor treatment plans, diagnose diseases with greater precision, and predict patient outcomes. Population health analytics also helps healthcare organizations identify high-risk groups, allocate resources more effectively, and implement preventive measures. Additionally, the integration of big data into healthcare systems supports real-time monitoring of patient health metrics, allowing for timely interventions and better overall outcomes. Pharmaceutical companies benefit from big data by accelerating drug discovery, refining clinical trials, and creating personalized medicines, driving innovation and progress in medical science.
With such a robust outlook for the big data market, investors are keenly eyeing companies that are well-positioned to capitalize on this trend. In this article, we will explore the best big data stocks to buy now, focusing on companies that are well-positioned to capitalize on the immense growth opportunities within this dynamic sector.
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A software engineer debugging a compliance code on a laptop in a modern office setting.
Workiva Inc. (NYSE:WK)
Average Analyst Share Price Target Upside: 26.81%
Average Analyst Share Price Target: $99.17
Workiva Inc. (NYSE: WK) has an average analyst share price target of $99.17, reflecting an upside potential of 26.81% as of August 16. Workiva Inc. (NYSE:WK) reported robust Q2 results on August 1, with an 18% increase in subscription revenue and a 15% rise in total revenue, driven by strong demand for ESG reporting solutions. The company introduced Workiva Carbon for carbon accounting and acquired Sustain.Life. Workiva Inc. (NYSE:WK) also authorized a $100 million share repurchase program and raised its revenue forecast, aiming for over $1 billion by 2027. Despite a $97 million drop in cash due to acquisitions and cautious macroeconomic outlook, Workiva Inc. (NYSE:WK) improved operating profit and strategic investments position it well for continued growth in the ESG sector.
Despite its stock trading 54% below its 2021 peak, it appears undervalued given its strong growth and profitability. Workiva Inc. (NYSE:WK) software integrates with major applications to streamline data aggregation and reporting, with notable demand for its ESG solutions as global regulations tighten. The company has seen substantial growth in high-spending customers and improved profitability, making its current stock price an attractive opportunity for investors.
TimesSquare Capital U.S. Small Cap Growth Strategy stated the following regarding Workiva Inc. (NYSE:WK) in its fourth quarter 2023 investor letter:
“Among the wide variety of Information Technology companies, we prefer critical system providers, specialized component designers, and systems that improve productivity or efficiency for their clients. Posting a 0% return—lagging the benchmark sector average of 14%—was Workiva Inc. (NYSE:WK), a leading cloud-based compliance and regulatory reporting platform. Workiva’s revenues exceeded expectations, though its earnings were lower because of a one-time interest expense. The relative share price weakness stemmed from management’s conservative guidance for its final fiscal quarter that incorporated the uncertain macroeconomic environment and Workiva shedding some low-margin businesses. Meanwhile, the company signed new customers and released updates to current financial reporting systems that should lead to better margins and further improve Workiva’s profitability.”
Overall WK ranks 3rd on our list of the best big data stocks to buy. While we acknowledge the potential of WK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than WK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.