Okta (OKTA) AI Stock Analysis

• Market Cap: $15.67B
• Dividend Yield: N/A
• Average Volume (3M): 2.93M
• Price to Earnings (P/E): 81.2
• Beta (1Y): 1.12
• Revenue Growth: 12.12%
• EPS Growth: N/A
• Country: US
• Employees: 5,914
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.82
• Shares Outstanding: 169,459,240
• 10 Day Avg. Volume: 3,037,769
• 30 Day Avg. Volume: 2,934,880
• PEG Ratio: -5.29
• Price to Book (P/B): 2.49
• Price to Sales (P/S): 6.12
• P/FCF Ratio: 21.89
• Enterprise Value/Market Cap: 0.91
• Enterprise Value/Revenue: 5.03
• Enterprise Value/Gross Profit: 6.53
• Enterprise Value/Ebitda: 45.22
• 1Y Price Target: $112.59
• Price Target Upside: 27.38% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 31
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: $101.00 ▲(14.27% Upside)

Okta's overall stock score reflects strong financial stability and positive technical momentum. The company's strategic focus on AI security and recent board enhancements are promising for future growth. However, high valuation and uncertainties in long-term guidance pose risks. Continued operational improvements and strategic execution will be key to sustaining investor confidence.

Positive Factors

Strong Cash Flow Management

Robust cash generation indicates effective financial management, providing flexibility for strategic investments and growth initiatives.

Board Strengthening

Enhancing board expertise in key areas supports strategic positioning and governance, crucial for navigating industry challenges and opportunities.

AI Security Growth Catalyst

AI security focus positions Okta to capitalize on emerging trends, driving long-term growth and expanding its market presence.

Negative Factors

Declining Revenue Growth

A declining revenue growth rate may hinder Okta's ability to scale operations efficiently, impacting future profitability and market competitiveness.

Limited FY '27 Guidance

Lack of future guidance introduces uncertainty, potentially affecting investor confidence and strategic planning.

Free Cash Flow Growth Decline

A decline in free cash flow growth could impact liquidity and limit Okta's ability to fund new initiatives or respond to market changes.

Okta Business Overview & Revenue Model

Company Description

Okta, Inc. provides identity solutions for enterprises, small and medium-sized businesses, universities, non-profits, and government agencies in the United States and internationally. The company offers Okta Identity Cloud, a platform that offers a suite of products and services, such as Universal Directory, a cloud-based system of record to store and secure user, application, and device profiles for an organization; Single Sign-On that enables users to access applications in the cloud or on-premise from various devices; Adaptive Multi-Factor Authentication provides a layer of security for cloud, mobile, Web applications, and data; Lifecycle Management that enables IT organizations or developers to manage a user's identity throughout its lifecycle; API Access Management that enables organizations to secure APIs; Access Gateway that enables organizations to extend the Okta Identity Cloud from the cloud to their existing on-premise applications; and Advanced Server Access to secure cloud infrastructure. It also provides Auth0 products, including Universal Login that allows customers to provide login experience across different applications and devices; Attack Protection, a suite of security capabilities that protect from malicious traffics; Adaptive Multi-Factor Authentication that minimizes friction to end users; Passwordless authentication enables users to login without a password and supports in various login methods; Machine to Machine provides standards-based authentication and authorization; private Cloud that allows customers to run a dedicated cloud instance of Auth0; and Organizations that enables customers to independent configurations, login experiences, and security options. It offers customer support, training, and professional services. It sells its products directly to customers through sales force and channel partners. The company was formerly known as Saasure, Inc. Okta, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.

How the Company Makes Money

Okta primarily generates revenue through a subscription-based model, charging customers for access to its identity management platform. The company's key revenue streams include fees for its various services, such as Single Sign-On and Multi-Factor Authentication, which are typically billed annually or monthly based on the number of users or applications integrated. Additionally, Okta has established strategic partnerships with other technology providers, which can enhance its offerings and drive customer acquisition. The company's success is also bolstered by the increasing demand for security solutions in response to the growing concerns over data breaches and cyber threats.

Okta Financial Statement Overview

Summary

Okta demonstrates financial stability with strong gross margins and cash flow management. However, declining revenue growth and modest profitability metrics suggest challenges in scaling operations efficiently. The balance sheet is solid with low leverage, providing a buffer against financial risks.

Income Statement

Okta's income statement shows a mixed performance. The TTM gross profit margin is strong at 76.83%, indicating efficient cost management. However, the net profit margin is low at 3.39%, reflecting challenges in converting revenue into profit. The revenue growth rate has declined significantly by 24.04% TTM, which is concerning. EBIT and EBITDA margins have improved but remain modest, suggesting room for operational efficiency improvements.

Balance Sheet

The balance sheet is relatively stable with a low debt-to-equity ratio of 0.06 TTM, indicating low leverage and financial risk. The return on equity is modest at 2.59% TTM, showing some profitability but room for improvement. The equity ratio is healthy, suggesting a strong capital structure. Overall, the balance sheet reflects financial stability with potential for enhanced returns.

Cash Flow

Cash flow analysis reveals a strong operating cash flow to net income ratio of 317.87 TTM, indicating robust cash generation relative to net income. The free cash flow to net income ratio is also high at 98.56%, highlighting effective cash management. However, the free cash flow growth rate has declined by 18.35% TTM, which could impact future liquidity. Overall, cash flow remains a strong aspect of Okta's financials.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.61B	2.26B	1.86B	1.30B	835.00M
Gross Profit	1.99B	1.68B	1.31B	904.00M	617.00M
EBITDA	139.00M	-245.00M	-676.00M	-651.00M	-156.00M
Net Income	28.00M	-355.00M	-815.00M	-848.00M	-266.00M
Balance Sheet
Total Assets	9.44B	8.99B	9.31B	9.21B	3.30B
Cash, Cash Equivalents and Short-Term Investments	2.52B	2.20B	2.58B	2.50B	2.56B
Total Debt	952.00M	1.30B	2.37B	2.03B	1.97B
Total Liabilities	3.03B	3.10B	3.84B	3.28B	2.60B
Stockholders Equity	6.41B	5.89B	5.47B	5.92B	694.04M
Cash Flow
Free Cash Flow	730.00M	488.00M	63.00M	87.00M	111.00M
Operating Cash Flow	750.00M	512.00M	86.00M	104.00M	128.00M
Investing Cash Flow	-314.00M	441.00M	-130.00M	-367.00M	-1.30B
Financing Cash Flow	-359.00M	-883.00M	48.00M	89.00M	1.09B

Okta Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 88.39
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: 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 88.39 is above the 20-day moving average (MA) of 87.16, above the 50-day MA of 86.30, and below the 200-day MA of 97.00, indicating a neutral trend. The MACD of 1.31 indicates Negative momentum. The RSI at 53.17 is Neutral, neither overbought nor oversold. The STOCH value of 34.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OKTA.

Okta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OKTA	75 Outperform	$15.67B	81.15	2.96%	―	12.12%	―
FTNT	71 Outperform	$60.37B	33.42	228.04%	―	14.78%	22.52%
CRWD	67 Neutral	$120.28B	-377.64	-8.88%	―	22.05%	-341.24%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
NET	61 Neutral	$70.99B	-681.44	-8.88%	―	28.06%	-7.44%
ZS	60 Neutral	$36.61B	-875.00	-2.41%	―	23.24%	-8.83%
SAIL	39 Underperform	$11.83B	-18.62	-10.58%	―	23.38%	-30.16%

Okta Corporate Events

Okta strengthens board with new independent technology directors

On December 18–19, 2025, Okta expanded its board of directors from 10 to 11 members and appointed technology veterans Rob Bernshteyn and Paul Sagan as independent directors, assigning Bernshteyn to the Audit and Cybersecurity Risk Committees and Sagan to the Compensation and Nominating Committees, with both receiving standard non-employee director compensation and indemnification. The move, coupled with the December 15, 2025 resignation of director Mary Agnes (Maggie) Wilderotter for unforeseen personal reasons not tied to disagreements with the company, underscores Okta’s effort to deepen board expertise in SaaS, cybersecurity and AI as identity becomes more central to securing emerging AI-driven technologies and to reinforcing its strategic positioning as a neutral identity partner for enterprises.

Okta Reports Strong Q3 2026 Financial Results

On December 2, 2025, Okta announced its third-quarter fiscal year 2026 financial results, reporting a 12% year-over-year revenue growth to $742 million and a 17% increase in remaining performance obligations. The company highlighted strong cash flow and increased adoption of new products, positioning itself as a key player in securing AI technology transformations. Okta’s strategic focus and solid financial performance indicate confidence in maintaining momentum into the fourth quarter and beyond.