Robert W. Baird analyst Shrenik Kothari has maintained their bullish stance on OKTA stock, giving a Buy rating today.
Claim 70% Off TipRanks Premium
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential
Shrenik Kothari has given his Buy rating due to a combination of factors that, in his view, indicate Okta is fundamentally strong yet undervalued. He highlights the newly authorized $1 billion share repurchase program as a clear signal of management’s confidence in the company’s long-term prospects and its belief that the current share price does not fully reflect intrinsic value. This move is supported by a solid financial foundation, including a sizable cash position, limited debt, and robust operating and free cash flow generation, with management already guiding to a strong free cash flow margin in FY26. Kothari also points out that Okta’s valuation multiples trade well below those of comparable high-growth SaaS peers, largely due to transitory issues such as sales model adjustments and seat-based headwinds that he expects to ease with continued execution.
Kothari views 2026 as a particularly attractive setup for the stock, as the company enters the year with improving cash generation, balance-sheet flexibility, and an additional capital return lever via buybacks. He frames Okta as an underappreciated specialized security platform within a broader sector context where similar multiple resets have historically preceded periods of strong outperformance. In his assessment, Okta’s role as a durable security control-plane provider, combined with potential upside from estimate revisions and operational improvements, creates room for positive surprises. Based on these considerations, his $125 price target reflects a premium to the current trading multiple but still a discount to sector medians, reinforcing his view that the risk/reward profile is favorable and supports a Buy recommendation.
In another report released today, RBC Capital also maintained a Buy rating on the stock with a $108.00 price target.