Okta (OKTA) AI Stock Analysis

• Market Cap: $16.33B
• Dividend Yield: N/A
• Average Volume (3M): 3.13M
• Price to Earnings (P/E): 110.4
• Beta (1Y): 1.23
• Revenue Growth: 12.68%
• EPS Growth: N/A
• Country: US
• Employees: 5,914
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.91
• Shares Outstanding: 168,459,010
• 10 Day Avg. Volume: 2,485,651
• 30 Day Avg. Volume: 3,133,742
• PEG Ratio: -5.29
• Price to Book (P/B): 2.49
• Price to Sales (P/S): 6.12
• P/FCF Ratio: 21.89
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 5.71
• Enterprise Value/Gross Profit: 7.43
• Enterprise Value/Ebitda: 56.15
• 1Y Price Target: $120.43
• Price Target Upside: 28.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 33

• Rating: 70 Neutral
• Price Target: $103.00 ▲(10.00% Upside)

Okta's overall stock score is driven by a positive earnings call and improved financial performance, despite high valuation concerns. The company's strategic initiatives and strong public sector growth contribute to an optimistic outlook.

Positive Factors

Strategic Acquisition

The acquisition of Acxiom Security enhances Okta's privileged access management capabilities, strengthening its product offering and competitive position in identity management.

Public Sector Growth

Significant growth in the public sector, particularly with the Department of Defense, indicates strong demand and potential for long-term contracts, enhancing revenue stability.

Revenue and Margin Guidance

Increased revenue and margin guidance reflects confidence in Okta's growth strategies and operational efficiency, suggesting sustainable financial performance.

Negative Factors

Decline in Revenue Growth

A significant decline in revenue growth could indicate challenges in market expansion or competitive pressures, potentially impacting long-term growth prospects.

Free Cash Flow Decline

A decline in free cash flow growth may limit Okta's ability to invest in new opportunities or weather economic downturns, affecting financial flexibility.

Challenges in Federal Vertical

Challenges in the federal vertical, such as contract restructuring and procurement delays, could hinder growth in a key market segment, affecting future revenue streams.

Okta Business Overview & Revenue Model

Company Description

Okta, Inc. provides identity solutions for enterprises, small and medium-sized businesses, universities, non-profits, and government agencies in the United States and internationally. The company offers Okta Identity Cloud, a platform that offers a suite of products and services, such as Universal Directory, a cloud-based system of record to store and secure user, application, and device profiles for an organization; Single Sign-On that enables users to access applications in the cloud or on-premise from various devices; Adaptive Multi-Factor Authentication provides a layer of security for cloud, mobile, Web applications, and data; Lifecycle Management that enables IT organizations or developers to manage a user's identity throughout its lifecycle; API Access Management that enables organizations to secure APIs; Access Gateway that enables organizations to extend the Okta Identity Cloud from the cloud to their existing on-premise applications; and Advanced Server Access to secure cloud infrastructure. It also provides Auth0 products, including Universal Login that allows customers to provide login experience across different applications and devices; Attack Protection, a suite of security capabilities that protect from malicious traffics; Adaptive Multi-Factor Authentication that minimizes friction to end users; Passwordless authentication enables users to login without a password and supports in various login methods; Machine to Machine provides standards-based authentication and authorization; private Cloud that allows customers to run a dedicated cloud instance of Auth0; and Organizations that enables customers to independent configurations, login experiences, and security options. It offers customer support, training, and professional services. It sells its products directly to customers through sales force and channel partners. The company was formerly known as Saasure, Inc. Okta, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.

How the Company Makes Money

Okta generates revenue primarily through a subscription-based model, offering various pricing tiers based on the number of users and the level of service required. The company's key revenue streams include subscriptions to its identity management platform and associated services, which are billed annually. Additionally, Okta benefits from upselling and cross-selling opportunities with existing customers by introducing new features or products. The company has established significant partnerships with major technology providers, such as Microsoft, AWS, and Google, which contribute to its earnings by integrating Okta's services with widely used platforms and expanding its customer base. Furthermore, Okta's focus on enterprise clients allows it to secure long-term contracts, providing a steady stream of recurring revenue.

Okta Financial Statement Overview

Summary

Okta's financial statements reflect a company in transition. While profitability and operational efficiency have improved, the decline in revenue growth and free cash flow are areas of concern. The balance sheet remains strong with low leverage, providing a solid foundation for future growth. Continued focus on revenue generation and cash flow management will be crucial for sustaining this positive momentum.

Income Statement

Okta's income statement shows a mixed performance. The company has achieved a positive net profit margin of 4.96% in the TTM, a significant improvement from previous losses, indicating a turnaround in profitability. However, the revenue growth rate has declined by 24.07% in the TTM, which is a concern. Gross profit margin remains strong at 76.90%, showcasing efficient cost management. The EBIT and EBITDA margins have also improved, reflecting better operational efficiency.

Balance Sheet

The balance sheet of Okta is relatively stable with a low debt-to-equity ratio of 0.14 in the TTM, indicating low financial leverage. Return on equity has improved to 2.10%, showing better utilization of shareholder funds. The equity ratio is healthy, suggesting a strong capital structure. However, the company needs to maintain this trajectory to ensure long-term financial stability.

Cash Flow

Okta's cash flow statement reveals some challenges. The free cash flow growth rate has declined by 41.79% in the TTM, which could impact future investments. However, the operating cash flow to net income ratio is robust at 168.27, indicating strong cash generation relative to net income. The free cash flow to net income ratio is nearly 1, showing efficient cash conversion.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.76B	2.61B	2.26B	1.86B	1.30B	835.00M
Gross Profit	2.13B	1.99B	1.68B	1.31B	904.00M	617.00M
EBITDA	281.00M	139.00M	-245.00M	-676.00M	-651.00M	-156.00M
Net Income	168.00M	28.00M	-355.00M	-815.00M	-848.00M	-266.00M
Balance Sheet
Total Assets	9.55B	9.44B	8.99B	9.31B	9.21B	3.30B
Cash, Cash Equivalents and Short-Term Investments	2.86B	2.52B	2.20B	2.58B	2.50B	2.56B
Total Debt	940.00M	952.00M	1.30B	2.37B	2.03B	1.97B
Total Liabilities	2.80B	3.03B	3.10B	3.84B	3.28B	2.60B
Stockholders Equity	6.75B	6.41B	5.89B	5.47B	5.92B	694.04M
Cash Flow
Free Cash Flow	838.00M	730.00M	488.00M	63.00M	87.00M	111.00M
Operating Cash Flow	853.00M	750.00M	512.00M	86.00M	104.00M	128.00M
Investing Cash Flow	-158.00M	-314.00M	441.00M	-130.00M	-367.00M	-1.30B
Financing Cash Flow	-339.00M	-359.00M	-883.00M	48.00M	89.00M	1.09B

Okta Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 93.64
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OKTA, the sentiment is Negative. The current price of 93.64 is above the 20-day moving average (MA) of 92.01, above the 50-day MA of 91.95, and below the 200-day MA of 98.44, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 43.58 is Neutral, neither overbought nor oversold. The STOCH value of 37.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OKTA.

Okta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FTNT	72 Outperform	$66.25B	34.40	165.17%	―	14.46%	48.06%
NET	70 Neutral	$76.67B	―	-11.04%	―	27.32%	-11.94%
OKTA	70 Neutral	$16.33B	110.41	2.61%	―	12.68%	―
ZS	67 Neutral	$49.69B	―	-2.70%	―	23.31%	31.04%
CRWD	66 Neutral	$127.97B	721.64	-8.99%	―	23.46%	-270.07%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
SAIL	53 Neutral	$12.49B	―	-11.15%	―	25.99%	-25.47%