Okta (OKTA) AI Stock Analysis

• Market Cap: $21.96B
• Dividend Yield: N/A
• Average Volume (3M): 3.57M
• Price to Earnings (P/E): 163.4
• Beta (1Y): 1.33
• Revenue Growth: 13.51%
• EPS Growth: N/A
• Country: US
• Employees: 5,914
• Sector: Technology
• Sector Strength: 80
• Industry: Software - Infrastructure
• EPS (TTM): 0.86
• Shares Outstanding: 167,161,470
• 10 Day Avg. Volume: 2,840,844
• 30 Day Avg. Volume: 3,572,600
• PEG Ratio: 5.89
• Price to Book (P/B): 3.03
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.51
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $124.79
• Price Target Upside: 18.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 37

• Rating: 62 Neutral
• Price Target: $112.00 ▲(6.44%Upside)

The overall stock score reflects Okta's solid financial performance, particularly in revenue growth and cash flow generation, which are critical strengths. The cautious outlook due to macroeconomic concerns slightly tempers the score, alongside high valuation metrics. Technical indicators present a mixed view, with short-term bearish signals contrasted by long-term bullish trends.

Positive Factors

Earnings Performance

Okta posted solid first-quarter results, with revenue and earnings per share beating consensus estimates.

Financial Health

Okta continues to make strides towards improving profitability, reporting record net income of $158mn and a healthy free cash flow margin of 35%.

Product and Market Expansion

Strength on the quarter was driven by new products, product bundles, U.S. federal demand, and specialization of the salesforce.

Negative Factors

Growth Outlook

Guidance suggests trends are likely to deteriorate further, with 2Q CRPO guidance of 11% growth compared to Street’s 14% implying QoQ deceleration versus the historical seasonal pattern of acceleration.

Guidance and Forecast

The company's Q2 CRPO guidance implies a decline, which is concerning as CRPO has never declined in a Q2 before.

Market Reaction

The stock pulled back approximately 11% after hours due to a conservative guidance for the second quarter.

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 makes money primarily through subscription fees for its cloud-based identity and access management services. The company offers its products on a per-user, per-month subscription basis, which provides a recurring revenue model. Key revenue streams include its Identity Cloud products, encompassing both workforce identity solutions for employee access and customer identity solutions for managing customer experiences. Significant partnerships, such as integrations with major cloud service providers and application vendors, enhance Okta's product offerings and expand its market reach. Factors contributing to its earnings include the rising demand for secure digital solutions and the growing need for efficient access management in increasingly complex IT environments.

Okta Financial Statement Overview

Summary

Okta demonstrates solid revenue growth and cash flow generation, which are critical for a software company. While profitability remains a challenge, the company is showing signs of improvement. The balance sheet is strong with low leverage and substantial equity, providing a cushion against financial volatility. Continued focus on profitability and cost management could enhance future financial performance.

Income Statement

Okta's income statement shows a strong revenue growth trajectory, with a TTM revenue increase to $1.93 billion from $1.85 billion the previous year. The gross profit margin remains high at approximately 76%, indicating operational efficiency. However, the net profit margin is just 0.26% due to significant operating expenses, though it marks an improvement from the previous negative margins. EBIT and EBITDA margins are improving but remain negative, reflecting ongoing profitability challenges.

Balance Sheet

The balance sheet reveals a stable equity base with a debt-to-equity ratio of 0.15, suggesting manageable leverage. Stockholders' equity covers 67.9% of total assets, highlighting a robust equity position. However, the return on equity is minimal at 0.08% due to low net income. The company maintains liquidity with significant cash reserves relative to its debt obligations.

Cash Flow

Okta's cash flow statement indicates strong cash generation, with a TTM operating cash flow of $464 million and free cash flow of $450 million, showcasing a positive free cash flow to net income ratio. The operating cash flow to net income ratio is significantly high, reflecting effective cash management. Free cash flow growth remains stable, highlighting a strong cash position despite the net income challenges.

Breakdown
Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
2.61B	2.26B	1.86B	1.30B	835.42M
	Gross Profit
1.99B	1.68B	1.31B	903.80M	617.74M
	EBIT
-74.00M	-460.00M	-783.00M	-767.10M	-204.16M
	EBITDA
25.00M	-230.00M	-676.00M	-649.90M	-156.00M
	Net Income Common Stockholders
28.00M	-355.00M	-815.00M	-848.41M	-266.33M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.52B	2.20B	2.58B	2.50B	2.59B
	Total Assets
9.44B	8.99B	9.31B	9.21B	3.30B
	Total Debt
952.00M	1.27B	2.33B	2.00B	1.95B
	Net Debt
543.00M	932.00M	2.07B	1.74B	1.51B
	Total Liabilities
3.03B	3.10B	3.84B	3.28B	2.60B
	Stockholders Equity
6.41B	5.89B	5.47B	5.92B	694.04M
Cash Flow		Free Cash Flow
730.00M	488.00M	63.00M	87.36M	110.59M
	Operating Cash Flow
750.00M	512.00M	86.00M	104.12M	127.96M
	Investing Cash Flow
-314.00M	441.00M	-130.00M	-366.81M	-1.31B
	Financing Cash Flow
-359.00M	-883.00M	48.00M	89.07M	1.09B

Okta Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 105.22
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• 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 105.22 is below the 20-day moving average (MA) of 120.18, below the 50-day MA of 110.50, and above the 200-day MA of 91.04, indicating a neutral trend. The MACD of 3.21 indicates Positive momentum. The RSI at 36.39 is Neutral, neither overbought nor oversold. The STOCH value of 36.60 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
PANW	81 Outperform	$125.00B	107.27	21.16%	―	13.91%	-50.96%
FTNT	80 Outperform	$80.17B	43.11	205.91%	―	13.83%	58.13%
ZS	79 Outperform	$39.81B	―	-1.21%	―	27.77%	89.39%
CRWD	76 Outperform	$113.48B	721.64	-0.69%	―	29.39%	-119.62%
NET	72 Outperform	$56.07B	―	-7.35%	―	27.79%	56.19%
OKTA	62 Neutral	$21.96B	163.37	2.08%	―	13.51%	―
Sector *	61 Neutral	$11.51B	10.19	-6.95%	2.94%	7.57%	-9.20%

Okta Corporate Events

Okta Reports Strong Q1 2026 Financial Results

On May 27, 2025, Okta announced its financial results for the first quarter of fiscal year 2026, ending April 30, 2025. The company reported a 12% increase in total revenue and subscription revenue year-over-year, with record GAAP and non-GAAP operating profitability. Okta’s remaining performance obligations grew by 21%, and the company achieved an operating cash flow of $241 million. The announcement underscores Okta’s focus on driving profitable growth and innovation in identity security solutions, with significant implications for its market positioning and stakeholder confidence.

The most recent analyst rating on (OKTA) stock is a Hold with a $81.00 price target. To see the full list of analyst forecasts on Okta stock, see the OKTA Stock Forecast page.

Okta Reports Record Profitability and Revenue Growth

On March 3, 2025, Okta announced its financial results for the fourth quarter and fiscal year ending January 31, 2025, showcasing significant growth and record profitability. The company reported a 13% year-over-year increase in total revenue for the fourth quarter, with subscription revenue also rising by 13%. Remaining performance obligations grew by 25%, indicating strong future revenue potential. Okta achieved record operating cash flow of $286 million and free cash flow of $284 million, reflecting its robust financial health. The results underscore Okta’s strategic positioning in the identity management industry, as it continues to innovate and meet the security needs of its customers.