Okta trends not translating to superior guidance, says BofA

BofA analyst Tomer Zilberman notes Okta (OKTA) reported “solid” fiscal Q2 results with outperformance driven by several tailwinds. However, Q3 cRPO growth guidance of 9.7% was in-line with consensus estimates and Q3 revenue guidance was “also largely in-line/a tad light vs. Street,” suggesting momentum may have peaked, the analyst tells investors. Management flagged that actual results should start reflecting closer to guidance levels, but the firm believes fundamental market dynamics, such as increasing competition, are “also largely at play,” adds the analyst, who reiterates an Underperform rating and $75 price target on Okta shares.