Arete Research Upgrades Okta (NASDAQ:OKTA) to Strong-Buy

Key Points

• Arete Research upgraded Okta from “strong sell” to “strong-buy,” signaling a sharply more bullish view on the identity security company.
• Despite mixed analyst opinions elsewhere, Okta now has a Moderate Buy consensus rating, with 1 Strong Buy, 30 Buy, 9 Hold, and 1 Sell ratings. The average price target sits at $103.08.
• Okta recently beat quarterly expectations, reporting EPS of $0.90 versus $0.85 expected and revenue of $761 million, up 11.6% year over year. The stock opened at $93.81, above its 50-day and 200-day moving averages.

Okta (NASDAQ:OKTA - Get Free Report) was upgraded by stock analysts at Arete Research from a "strong sell" rating to a "strong-buy" rating in a report released on Tuesday,Zacks.com reports.

OKTA has been the topic of several other reports. Morgan Stanley reduced their price objective on Okta from $110.00 to $101.00 and set an "overweight" rating on the stock in a research report on Thursday, March 5th. UBS Group set a $85.00 price objective on Okta in a research report on Thursday, April 16th. Scotiabank reduced their price objective on Okta from $85.00 to $80.00 and set a "sector perform" rating on the stock in a research report on Thursday, March 5th. Needham & Company LLC reduced their price objective on Okta from $110.00 to $90.00 and set a "buy" rating on the stock in a research report on Thursday, March 5th. Finally, Sanford C. Bernstein restated an "outperform" rating and issued a $134.00 price objective on shares of Okta in a research report on Friday, March 6th. One equities research analyst has rated the stock with a Strong Buy rating, thirty have given a Buy rating, nine have issued a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat, the stock has a consensus rating of "Moderate Buy" and an average price target of $103.08.

Okta Stock Performance

OKTA opened at $93.81 on Tuesday. The business's fifty day moving average is $78.44 and its two-hundred day moving average is $82.59. The company has a market cap of $16.59 billion, a price-to-earnings ratio of 71.61, a PEG ratio of 3.59 and a beta of 0.59. Okta has a one year low of $62.66 and a one year high of $127.52.

Okta (NASDAQ:OKTA - Get Free Report) last posted its earnings results on Wednesday, March 4th. The company reported $0.90 EPS for the quarter, topping analysts' consensus estimates of $0.85 by $0.05. The company had revenue of $761.00 million for the quarter, compared to the consensus estimate of $749.87 million. Okta had a return on equity of 4.18% and a net margin of 8.05%.Okta's quarterly revenue was up 11.6% compared to the same quarter last year. During the same period in the previous year, the business earned $0.78 earnings per share. Okta has set its FY 2027 guidance at 3.740-3.820 EPS and its Q1 2027 guidance at 0.840-0.860 EPS. On average, analysts predict that Okta will post 1.61 EPS for the current fiscal year.

Insider Activity

In related news, CRO Jonathan James Addison sold 23,304 shares of the stock in a transaction dated Wednesday, March 25th. The stock was sold at an average price of $77.79, for a total transaction of $1,812,818.16. Following the transaction, the executive directly owned 4,364 shares in the company, valued at approximately $339,475.56. This represents a 84.23% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, CEO Todd Mckinnon sold 11,263 shares of the stock in a transaction dated Monday, March 23rd. The stock was sold at an average price of $81.01, for a total value of $912,415.63. Following the transaction, the chief executive officer owned 97,083 shares in the company, valued at $7,864,693.83. This trade represents a 10.40% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 70,884 shares of company stock valued at $5,625,648 in the last three months. Company insiders own 4.61% of the company's stock.

Hedge Funds Weigh In On Okta

Several large investors have recently added to or reduced their stakes in the business. Vanguard Group Inc. increased its stake in Okta by 5.7% during the third quarter. Vanguard Group Inc. now owns 19,803,227 shares of the company's stock worth $1,815,956,000 after acquiring an additional 1,074,977 shares during the last quarter. Robeco Institutional Asset Management B.V. increased its stake in Okta by 52.9% during the fourth quarter. Robeco Institutional Asset Management B.V. now owns 465,370 shares of the company's stock worth $40,241,000 after acquiring an additional 161,069 shares during the last quarter. Elo Mutual Pension Insurance Co increased its stake in Okta by 40.1% during the third quarter. Elo Mutual Pension Insurance Co now owns 52,597 shares of the company's stock worth $4,823,000 after acquiring an additional 15,058 shares during the last quarter. Congress Asset Management Co. increased its stake in Okta by 23.0% during the fourth quarter. Congress Asset Management Co. now owns 98,063 shares of the company's stock worth $8,480,000 after acquiring an additional 18,325 shares during the last quarter. Finally, Federated Hermes Inc. increased its stake in Okta by 18.7% during the third quarter. Federated Hermes Inc. now owns 269,505 shares of the company's stock worth $24,714,000 after acquiring an additional 42,395 shares during the last quarter. 86.64% of the stock is currently owned by hedge funds and other institutional investors.

Okta Company Profile

Okta, Inc is a publicly traded provider of identity and access management solutions, headquartered in San Francisco, California. Founded in 2009 by Todd McKinnon and Frederic Kerrest, the company completed its initial public offering in April 2017. Under the leadership of McKinnon as chief executive officer and Kerrest as chief operating officer, Okta has grown into a leading vendor in the cybersecurity space, focusing on secure user authentication, single sign-on and lifecycle management for digital identities.

At the core of Okta's offering is the Okta Identity Cloud, a suite of cloud-native services that enable organizations to manage user access across web and mobile applications, on-premises systems and APIs.

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