'Melt Up' Mania Primes This Tech Company to Take Off

The stock market boomed in 2019... but more gains could be around the corner.

Regular Stansberry Research readers should be familiar with the phrase "Melt Up."

As our colleague Steve Sjuggerud explained, the final months of a bull market tend to bring the biggest gains for stocks. It's the last push before a "Melt Down" arrives.

The Melt Up has played out as expected so far.

In 2019, all the major U.S. indexes rallied to all-time highs.

The S&P 500 climbed nearly 30% in 2019. The tech-heavy Nasdaq index soared even more, posting a 35% gain in 2019. The Dow Jones Industrial Average brought up the rear of the pack, up "only" 22%.

And more and more people are catching on to the Melt Up thesis as we move into 2020...

Just last month, strategists at Bank of America jumped on the bandwagon.

With risks from the trade war and Brexit subsiding, the strategists said stock markets are "primed for a melt-up" in the first quarter of 2020, and predicted that the S&P 500 will surge 5% in the first two months of the year.

Today's company should outperform as the Melt Up rages on...

Workday (Nasdaq: WDAY) is a $38 billion company that offers software services to keep track of things like finances, employees, accounting, and more.

It puts all your data and analysis in a simple-to-use cloud interface. That allows business owners and management to focus on what's important: growing their business.

Workday has a wide-range of products that fit its customers' needs.

For example, a simple package of Workday's products will provide you with everything you need to become a self-sufficient user. Your employees will learn the software on their own.

But if you need more assistance, you can pay for a higher level of service. This can include Workday experts who are available 24/7 to solve issues and help make life easier. Workday offers a wide variety of products in between to suit any company's exact needs.

This is a key service, and that's why well-known companies like Amazon (AMZN) trust Workday.

Workday helps Amazon keep track of and hire new employees. The technical term is "human capital management." Workday stores employee data, assists with time management, and makes sure detailed information is easy to find and accessible.

It also helps Amazon figure out how many people it may need to hire, and where. Workday tracks all this data with easy access on any device.

And Amazon isn't its only well-known customer...

The world's largest travel site, TripAdvisor, uses Workday on an even broader scale.

TripAdvisor uses Workday's financial management, human-capital management, payroll, time tracking, expenses, and procurement products.

Workday handles multiple parts of TripAdvisor's business. And according to TripAdvisor, it cut costs significantly in the process.

Amazon and TripAdvisor are just two of Workday's global clients. And many others are household names, such as Netflix, Activision, and Target.

Workday offers a valuable service. Business management is important for any company. But it's time-consuming and expensive. You'll fail if you get it wrong, but getting it right doesn't mean you'll succeed, either.

By using Workday's services, companies outsource these parts of their business and focus on growth. It's no surprise that customers are happy with Workday as a result. And that has led to big growth in recent years.

The company's revenue has grown from just $68 million in 2010 to roughly $3.4 billion in the last 12 months. And revenue grew 31% in that time period alone.

These are stellar numbers, and they're likely to continue. Analysts expect the company to grow revenue by more than 20% a year through 2021.

On top of growing revenue, Workday is a business built on great margins.

This is common in software businesses. Once you build great software, it's cheap to scale. Workday's gross margins were 71% in 2018. And analysts expect them to grow from there... to 75% by the end of 2019.

The company is also closing in on becoming profitable.

In recent years, it has spent money to grow. But Bloomberg analysts expect Workday to turn profitable as early as the 2020 fiscal year (which ends January 31, 2020), generating around $250 million in profits. That number could grow to more than $600 million by 2021.

Importantly, the company is in strong financial shape, too. It has more than $2 billion in cash and just $1.6 billion in debt. And it produced free cash flow ("FCF") of $576 million over the last four quarters. So, there's no major investment risk here.

Workday has built a strong, growing business by providing a necessary service to companies across the globe. And it's on the cusp of becoming profitable. As the Melt Up continues to unfold, Workday is a perfect example of a company that will see its stock soar.

Sometimes investing is simple.