Workday$($WDAY$)$ is an on$$demand $($cloud$-$based$)$ financial management and human capital management

software vendor. It was founded by David Duffield, founder and former CEO of ERP company PeopleSoft,

and former PeopleSoft chief strategist Aneel Bhusri following Oracle's hostile takeover of PeopleSoft in

$2005.$ In October $2012,$ it launched a successful initial public offering that valued the company at $$9\mathrm{.}5$

billion. Competitors include SAP Successfactors, Oracle, PayScale, and beqom.

Workday is traded at $$180\mathrm{.}96$ per share on October $16,2019.$ Analysts are forecasting earnings per share of

$$1\mathrm{.}69$ for $2020$ and $$2\mathrm{.}22$ for $2021.$ The firm does not pay dividends. The risk$-$free rate at the time was

about $1\mathrm{.}65\%,$ Beta was $0\mathrm{.}96,$ and you require a $6\%$ risk premium for investing in this stock.

Value WDAY using the Abnormal Earnings Growth $($AEG$)$ model. Assume that AEG will continue

to grow at $1\mathrm{.}8\%$ after $2021.$