On Monday, JPMorgan reiterated its Neutral rating on Okta, Inc. (NASDAQ: NASDAQ:OKTA) with a steady price target of $105.00. The firm's commentary followed a virtual investor meeting held last week in Asia with Okta's SVP of Investor Relations, Dave Gennarelli.
The discussions covered a range of topics including the identity market, Okta's growth prospects, long-term potential, competitive dynamics, and recent events such as the FBI raid on Carahsoft.
"The company continues to take a thoughtful approach toward building a competitive platform while balancing necessary investments with profitability," said JPMorgan analysts in a note.
In other recent news, Okta Inc . has seen adjustments in its financial outlook following its second-quarter fiscal year 2025 results. The company reported a 16% year-over-year revenue increase to $646 million, primarily due to a 17% rise in subscription revenue. However, Okta's third-quarter calculated remaining performance obligations (cRPO) guidance fell short of projections.
Analyst firms such as Piper Sandler and Canaccord Genuity adjusted their price targets for Okta to $100 and $90, respectively. In contrast, BMO Capital Markets raised its price target to $103, citing Okta's robust growth in remaining performance obligations. Deutsche Bank lowered its price target for Okta's shares to $115 while maintaining a Buy rating.
InvestingPro Insights
To complement JPMorgan's analysis, recent data from InvestingPro offers additional context on Okta's financial position and market performance. Despite the company's focus on balancing investment and profitability, InvestingPro data shows that Okta was not profitable over the last twelve months, with an adjusted operating income of -$228 million. However, the company's gross profit margin stands at an impressive 75.82%, reflecting strong pricing power in its identity management offerings.
InvestingPro Tips highlight that Okta holds more cash than debt on its balance sheet, which could provide financial flexibility as it navigates market challenges and invests in growth. Additionally, 31 analysts have revised their earnings upwards for the upcoming period, suggesting a potentially positive outlook that aligns with JPMorgan's steady price target.
It's worth noting that Okta's stock has taken a significant hit over the last six months, with a price total return of -29.28%. This decline might present an opportunity for investors, as the RSI suggests the stock is in oversold territory. For those interested in a deeper dive into Okta's financials and market position, InvestingPro offers 10 additional tips that could inform investment decisions.
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