tiprankstipranks
Trending News
More News >
Okta (OKTA)
NASDAQ:OKTA
Advertisement

Okta (OKTA) AI Stock Analysis

Compare
8,255 Followers

Top Page

OKTA

Okta

(NASDAQ:OKTA)

Select Model
Select Model
Select Model
Neutral 63 (OpenAI - 4o)
Rating:63Neutral
Price Target:
$95.00
▲(6.66% Upside)
Okta's overall stock score is driven by a positive earnings call with strong future guidance and strategic initiatives. However, the high P/E ratio and declining revenue growth rate weigh on the score. Technical indicators suggest a lack of strong momentum, and the absence of a dividend yield affects valuation.
Positive Factors
Strategic Acquisitions
Acquiring Acxiom Security enhances Okta's capabilities in privileged access management, strengthening its product offerings and competitive position in identity management.
Public Sector Growth
Strong performance in the public sector, including a major deal with the Department of Defense, indicates robust demand and potential for sustained revenue growth in a stable market.
Improved Financial Outlook
Increased guidance for revenue and margins reflects management's confidence in strategic initiatives and operational improvements, supporting long-term financial health.
Negative Factors
Declining Revenue Growth
A significant decline in revenue growth could indicate challenges in market expansion or competitive pressures, potentially impacting long-term growth prospects.
Free Cash Flow Decline
A decline in free cash flow growth may limit Okta's ability to invest in new opportunities or weather economic downturns, affecting future financial flexibility.
Challenges in Federal Vertical
Challenges in the federal vertical, such as contract restructuring and procurement delays, could hinder growth in a key market segment, affecting revenue stability.

Okta (OKTA) vs. SPDR S&P 500 ETF (SPY)

Okta Business Overview & Revenue Model

Company DescriptionOkta, Inc. is a leading identity and access management company that provides secure identity solutions for enterprises, enabling organizations to manage and secure user authentication into applications, devices, and APIs. Founded in 2009, Okta operates primarily in the technology sector, focusing on identity management, security, and user experience across various industries. Its core products include single sign-on (SSO), multi-factor authentication (MFA), lifecycle management, and API access management, which help organizations streamline user access while enhancing security.
How the Company Makes MoneyOkta generates revenue primarily through a subscription-based model, offering various pricing tiers based on the number of users and the level of service required. The company's key revenue streams include subscriptions to its identity management platform and associated services, which are billed annually. Additionally, Okta benefits from upselling and cross-selling opportunities with existing customers by introducing new features or products. The company has established significant partnerships with major technology providers, such as Microsoft, AWS, and Google, which contribute to its earnings by integrating Okta's services with widely used platforms and expanding its customer base. Furthermore, Okta's focus on enterprise clients allows it to secure long-term contracts, providing a steady stream of recurring revenue.

Okta Key Performance Indicators (KPIs)

Any
Any
Revenue by Segment
Revenue by Segment
Analyzes revenue across different business units, highlighting which segments are driving growth and where Okta might face challenges or opportunities.
Chart InsightsOkta's Subscription revenue continues its steady upward trajectory, reflecting robust demand for its core offerings. However, Professional Services and Other revenue remains stagnant, indicating limited growth in this segment. The latest earnings call underscores strong cash flow and profitability, driven by new product growth and large customer success. Despite these positives, management's cautious guidance for FY 2026 highlights macroeconomic uncertainties and a sequential decline in cRPO, suggesting potential challenges ahead. The strategic specialization of sales teams, particularly in the U.S. public sector, is expected to bolster long-term growth.
Data provided by:Main Street Data

Okta Earnings Call Summary

Earnings Call Date:Aug 26, 2025
(Q2-2026)
|
% Change Since: |
Next Earnings Date:Nov 26, 2025
Earnings Call Sentiment Positive
The earnings call reflects a predominantly positive outlook for Okta, with strong Q2 performance, significant growth in the public sector, a robust pipeline, and strategic acquisitions driving future potential. Despite minor challenges in the federal vertical and stabilization of NRR, the overall sentiment is optimistic, with raised revenue and margin guidance for FY 2026.
Q2-2026 Updates
Positive Updates
Strong Q2 Results and Growth in Public Sector
Okta reported solid Q2 results with significant strength in the public sector market. Five of the top 10 deals were with the US public sector, including their largest deal of the quarter with the Department of Defense.
Record Pipeline Generation
Okta achieved an all-time high in pipeline generation for Q2, indicating strong future growth potential. This was attributed to the specialization of sales teams and improved sales productivity.
Increased Revenue and Margin Guidance for FY 2026
Okta raised its full-year fiscal 2026 guidance, expecting total revenue growth of 10% to 11%, a non-GAAP operating margin of 25% to 26%, and a free cash flow margin of approximately 28%.
Strategic Acquisition of Acxiom Security
Okta announced the acquisition of Acxiom Security, a modern PAM vendor, to enhance their privileged access management capabilities and secure critical infrastructure.
Introduction of Cross-App Access Standard
Okta introduced a new open standard called cross-app access to control access for AI agents, gaining strong interest from partners like AWS, Zoom, and Box.
Negative Updates
Challenges in Federal Vertical
Despite strong results, Okta experienced some contract restructuring with civilian agencies and delays in procurement processes within the federal vertical.
Stabilization of Net Revenue Retention (NRR)
NRR has stabilized at 106%, with ongoing concerns about down-sell pressures, although these are expected to subside in the latter half of the fiscal year.
Company Guidance
During Okta's second quarter fiscal 2026 earnings webcast, the company provided several key financial metrics and guidance for future performance. Okta reported a solid Q2 with highlights including improved sales productivity and record pipeline generation. The company continues to see strong performance in its public sector business, with five of their top ten deals in Q2 involving the US public sector, including the Department of Defense. Okta's financial outlook for Q3 and FY 2026 is optimistic, with expectations for total revenue growth of 9-10% for Q3 and 10-11% for the full fiscal year. The company anticipates a non-GAAP operating margin of 22% for Q3 and 25-26% for FY 2026, with a free cash flow margin of approximately 28% for the full year. Okta has removed previous conservatism in its outlook related to macroeconomic uncertainty and federal verticals, highlighting its confidence in its go-to-market strategies and improved specialization efforts. Additionally, the company announced a definitive agreement to acquire Acxiom Security, aiming to enhance its privileged access management capabilities.

Okta Financial Statement Overview

Summary
Okta's financial statements reflect a company in transition. While profitability and operational efficiency have improved, the decline in revenue growth and free cash flow are areas of concern. The balance sheet remains strong with low leverage, providing a solid foundation for future growth. Continued focus on revenue generation and cash flow management will be crucial for sustaining this positive momentum.
Income Statement
65
Positive
Okta's income statement shows a mixed performance. The company has achieved a positive net profit margin of 4.96% in the TTM, a significant improvement from previous losses, indicating a turnaround in profitability. However, the revenue growth rate has declined by 24.07% in the TTM, which is a concern. Gross profit margin remains strong at 76.90%, showcasing efficient cost management. The EBIT and EBITDA margins have also improved, reflecting better operational efficiency.
Balance Sheet
70
Positive
The balance sheet of Okta is relatively stable with a low debt-to-equity ratio of 0.14 in the TTM, indicating low financial leverage. Return on equity has improved to 2.10%, showing better utilization of shareholder funds. The equity ratio is healthy, suggesting a strong capital structure. However, the company needs to maintain this trajectory to ensure long-term financial stability.
Cash Flow
60
Neutral
Okta's cash flow statement reveals some challenges. The free cash flow growth rate has declined by 41.79% in the TTM, which could impact future investments. However, the operating cash flow to net income ratio is robust at 168.27, indicating strong cash generation relative to net income. The free cash flow to net income ratio is nearly 1, showing efficient cash conversion.
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue2.76B2.61B2.26B1.86B1.30B835.00M
Gross Profit2.13B1.99B1.68B1.31B904.00M617.00M
EBITDA281.00M139.00M-245.00M-676.00M-651.00M-156.00M
Net Income168.00M28.00M-355.00M-815.00M-848.00M-266.00M
Balance Sheet
Total Assets9.55B9.44B8.99B9.31B9.21B3.30B
Cash, Cash Equivalents and Short-Term Investments2.86B2.52B2.20B2.58B2.50B2.56B
Total Debt940.00M952.00M1.30B2.37B2.03B1.97B
Total Liabilities2.80B3.03B3.10B3.84B3.28B2.60B
Stockholders Equity6.75B6.41B5.89B5.47B5.92B694.04M
Cash Flow
Free Cash Flow838.00M730.00M488.00M63.00M87.00M111.00M
Operating Cash Flow853.00M750.00M512.00M86.00M104.00M128.00M
Investing Cash Flow-158.00M-314.00M441.00M-130.00M-367.00M-1.30B
Financing Cash Flow-339.00M-359.00M-883.00M48.00M89.00M1.09B

Okta Technical Analysis

Technical Analysis Sentiment
Negative
Last Price89.07
Price Trends
50DMA
91.07
Negative
100DMA
94.04
Negative
200DMA
98.77
Negative
Market Momentum
MACD
-1.03
Positive
RSI
46.69
Neutral
STOCH
44.81
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 89.07 is below the 20-day moving average (MA) of 90.54, below the 50-day MA of 91.07, and below the 200-day MA of 98.77, indicating a bearish trend. The MACD of -1.03 indicates Positive momentum. The RSI at 46.69 is Neutral, neither overbought nor oversold. The STOCH value of 44.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OKTA.

Okta Risk Analysis

Okta disclosed 61 risk factors in its most recent earnings report. Okta reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Okta Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
$65.56B34.15165.17%14.46%48.06%
71
Outperform
$51.13B-2.70%23.31%31.04%
69
Neutral
$75.92B-11.04%27.32%-11.94%
66
Neutral
$132.33B-8.99%23.46%-270.07%
63
Neutral
$15.70B105.022.61%12.68%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
53
Neutral
$12.44B25.99%-25.47%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
OKTA
Okta
89.07
15.82
21.60%
FTNT
Fortinet
85.56
4.80
5.94%
ZS
Zscaler
323.00
136.00
72.73%
CRWD
CrowdStrike Holdings
527.32
226.00
75.00%
NET
Cloudflare
217.85
129.91
147.73%
SAIL
SailPoint, Inc.
22.35
-2.20
-8.96%

Okta Corporate Events

Okta’s Earnings Call Highlights Growth and Optimism
Sep 1, 2025

The recent earnings call for Okta, Inc. conveyed a predominantly positive sentiment, highlighting the company’s strong Q2 performance and growth prospects. The call emphasized significant achievements in the public sector, a robust pipeline, and strategic acquisitions, all contributing to an optimistic outlook. Despite minor challenges in the federal vertical and stabilization of Net Revenue Retention (NRR), the sentiment remained upbeat, with raised revenue and margin guidance for fiscal year 2026.

Okta, Inc. Reports Strong Q2 2026 Financial Results
Aug 27, 2025

Okta, Inc. is a leading independent identity management company that provides secure identity solutions for businesses and developers, empowering them to use technology safely and efficiently. The company operates primarily in the technology sector, focusing on authentication and authorization services.

Financial DisclosuresLegal Proceedings
Okta Reports Q2 2026 Financial Results with Revenue Growth
Positive
Aug 26, 2025

On August 26, 2025, Okta announced its financial results for the second quarter of fiscal year 2026, highlighting a 13% year-over-year revenue growth and a 12% increase in subscription revenue. The company reported significant improvements in operating cash flow and net income, reflecting strong product adoption and performance in the public sector. Additionally, Okta has reached a preliminary settlement in ongoing stockholder derivative litigation, with a final approval hearing scheduled for October 24, 2025.

The most recent analyst rating on (OKTA) stock is a Buy with a $119.00 price target. To see the full list of analyst forecasts on Okta stock, see the OKTA Stock Forecast page.

Business Operations and StrategyExecutive/Board Changes
Okta Expands Board with Two New Directors
Positive
Aug 14, 2025

On August 11, 2025, Okta, Inc. announced the expansion of its Board of Directors from eight to ten members, appointing David Schellhase as an independent director and Mary Agnes (Maggie) Wilderotter as a non-independent director, effective August 13, 2025. These appointments are expected to enhance Okta’s strategic positioning as it aims to secure AI and expand its identity market leadership. Both directors bring extensive experience in technology and corporate strategy, with Schellhase having a background in legal and operational roles at major tech companies and Wilderotter holding significant leadership positions across various industries. Their insights are anticipated to contribute to Okta’s growth and innovation in the identity security landscape.

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 11, 2025