Okta (OKTA) AI Stock Analysis

• Market Cap: $18.13B
• Dividend Yield: N/A
• Average Volume (3M): 5.01M
• Price to Earnings (P/E): 163.9
• Beta (1Y): 1.27
• Revenue Growth: 13.51%
• EPS Growth: N/A
• Country: US
• Employees: 5,914
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Infrastructure
• EPS (TTM): 0.86
• Shares Outstanding: 167,163,420
• 10 Day Avg. Volume: 7,151,668
• 30 Day Avg. Volume: 5,013,587
• PEG Ratio: 0.27
• Price to Book (P/B): 2.80K
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.93
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 1.72
• Enterprise Value/Gross Profit: 11.59
• Enterprise Value/Ebitda: 220.55
• 1Y Price Target: $125.88
• Price Target Upside: 19.20% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 35

• Rating: 65 Neutral
• Price Target: $113.00 ▲(7.01%Upside)

Okta's stock score is primarily driven by its robust financial performance, with strong revenue growth and cash flow metrics. The earnings call and corporate events further support a positive outlook despite macroeconomic concerns. However, technical indicators and high valuation present near-term risks.

Positive Factors

Customer Growth

Okta reported strong up/cross sell, stable seats, and one of the strongest quarters for net new customers in the last two years.

Financial Performance

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

Product Development

Management highlighted new products continue to resonate exhibited by the number of workflow executions increasing ~400% over the past three years.

Negative Factors

Demand Concerns

The decline in the cRPO coverage ratio raised investor worries about hidden signals of weakness in demand, contrasting with the company's narrative.

Growth Deceleration

The focal point of the quarter was the weak underlying trends of the company in addition to a lackluster 2Q cRPO guide signaling further deceleration is on the horizon.

Revenue Guidance

The guide itself is low as the company added additional conservatism from macroeconomic factors and a specific business area headwind, which is considered justified.

Okta Business Overview & Revenue Model

Company Description

Okta, Inc. is a leading independent provider of identity management solutions for enterprises, focusing on securing user authentication and access to applications and devices. Operating in the cloud computing sector, Okta provides a robust identity platform for businesses, helping them manage and secure user identities and streamline access across various applications. Its core products and services include the Okta Identity Cloud, which consists of products like Single Sign-On (SSO), Multi-Factor Authentication (MFA), Universal Directory, and Lifecycle Management, catering to the needs of businesses looking to enhance security and user experiences.

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
TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
2.68B	2.61B	2.26B	1.86B	1.30B	835.42M
	Gross Profit
1.52B	1.99B	1.68B	1.31B	903.80M	617.74M
	EBIT
-26.96M	-74.00M	-460.00M	-783.00M	-767.10M	-204.16M
	EBITDA
61.04M	25.00M	-230.00M	-676.00M	-649.90M	-156.00M
	Net Income Common Stockholders
68.06M	28.00M	-355.00M	-815.00M	-848.41M	-266.33M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.58B	2.52B	2.20B	2.58B	2.50B	2.59B
	Total Assets
9.31B	9.44B	8.99B	9.31B	9.21B	3.30B
	Total Debt
2.37B	952.00M	1.27B	2.33B	2.00B	1.95B
	Net Debt
2.10B	543.00M	932.00M	2.07B	1.74B	1.51B
	Total Liabilities
3.84B	3.03B	3.10B	3.84B	3.28B	2.60B
	Stockholders Equity
5.47B	6.41B	5.89B	5.47B	5.92B	694.04M
Cash Flow		Free Cash Flow
520.24M	730.00M	488.00M	63.00M	87.36M	110.59M
	Operating Cash Flow
531.24M	750.00M	512.00M	86.00M	104.12M	127.96M
	Investing Cash Flow
-120.12M	-314.00M	441.00M	-130.00M	-366.81M	-1.31B
	Financing Cash Flow
-57.31M	-359.00M	-883.00M	48.00M	89.07M	1.09B

Okta Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 105.60
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OKTA, the sentiment is Neutral. The current price of 105.6 is below the 20-day moving average (MA) of 117.88, below the 50-day MA of 109.58, and above the 200-day MA of 91.33, indicating a neutral trend. The MACD of -1.61 indicates Positive momentum. The RSI at 39.98 is Neutral, neither overbought nor oversold. The STOCH value of 9.80 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OKTA.

Okta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PANW	81 Outperform	$131.44B	111.06	21.16%	―	13.91%	-50.96%
FTNT	80 Outperform	$78.43B	42.35	205.91%	―	13.83%	58.13%
CRWD	79 Outperform	$121.74B	721.64	-5.76%	―	25.94%	-226.80%
NET	74 Outperform	$58.82B	―	-7.35%	―	27.79%	56.19%
ZS	74 Outperform	$45.93B	―	-2.68%	―	25.46%	49.20%
OKTA	65 Neutral	$18.13B	163.95	2.08%	―	13.51%	―
Sector *	62 Neutral	$11.70B	10.39	-7.10%	2.92%	7.45%	-8.42%

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.