Keith Bachman, an analyst from BMO Capital, maintained the Hold rating on Okta. The associated price target was lowered to $90.00.
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Keith Bachman has given his Hold rating due to a combination of factors that reflect both positive developments and certain limitations in Okta’s performance. While Okta has surpassed expectations on key metrics and raised its annual guidance, the company’s guidance for the January quarter was slightly underwhelming, suggesting a cautious outlook. The company’s revenue growth remains solid, driven by strong engagement with larger enterprises and successful upselling of new products. However, the potential impact of AI products on revenue is expected to take time, and the broader macroeconomic environment remains steady but uncertain.
Despite improvements in execution and sales productivity, Bachman notes that Okta’s stock faces challenges due to sector-wide multiple compression, leading to a reduced target price. The company’s revenue outlook for FY26 appears conservative, and while professional services have seen growth, this is attributed to demand from a few large customers, which may not be sustainable. Overall, Bachman believes that Okta has limited potential for significant estimate or multiple upside due to inconsistent execution and relatively limited traction with new products, despite ongoing improvements.
In another report released today, TD Cowen also maintained a Hold rating on the stock with a $115.00 price target.