UBS initiates Workday coverage at sell as cloud adoption rates start to slow

Workday co-founders and co-CEOs Aneel Bhusri (left) and Dave Duffield (center) applaud their company's first trade after their IPO at the New York Stock Exchange on Oct. 12, 2012.
Brendan McDermid | Reuters

Increased competition and slowing cloud adoption rates will undercut growth for the human resources software maker Workday, according to one Wall Street analyst.

UBS initiated coverage of Workday at sell Wednesday, citing a projected revenue deceleration over the next several years.

"We expect healthy, but moderating subscription revenue growth, as Cloud HR adoption rates and increasing competition from legacy players drive growth below historical levels," wrote UBS analyst Jennifer Lowe in a note to clients.