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On Wednesday, Stifel analysts increased their price target for Okta, Inc (NASDAQ:OKTA) shares to $130.00, up from the previous target of $120.00, while reiterating a Buy rating on the stock. This adjustment follows Okta’s release of its first-quarter financial results for fiscal year 2026, which surpassed both the company’s guidance and analysts’ expectations. According to InvestingPro data, Okta maintains impressive gross profit margins of 76.32% and currently trades near its 52-week high of $127.57.
The company’s performance was notably strong, with key metrics exceeding guidance and estimates. However, Okta’s shares experienced a decline of over 12% in after-hours trading. Analysts pointed out that the current Remaining Performance Obligations (cRPO) growth of 14% year-over-year, although above the guidance of 12%, fell short of the anticipated 15%-16% whisper numbers. Additionally, the cRPO forecast for the second quarter of fiscal year 2026 was slightly below consensus, aligning with Stifel’s projections. Despite the recent volatility, InvestingPro data shows the stock has delivered an impressive 64.22% return over the past six months.
Despite the after-hours stock movement, several positive aspects were highlighted in Okta’s report. The company showed early signs of successful go-to-market strategy changes, increased traction with Auth0 and new logos, and continued momentum across its newer product offerings.
Okta’s management commented on the company’s resilience in the face of macroeconomic factors, noting no significant impacts during the April quarter and into early May. Nevertheless, they have incorporated additional caution into their guidance. While reaffirming the full-year 2026 top-line guidance, the company anticipates profitability to increase, albeit at a rate less than the recent beat.
In other recent news, Okta Inc . reported impressive results for the first quarter of fiscal year 2026, exceeding both earnings and revenue expectations. The company achieved earnings per share of $0.86, surpassing the anticipated $0.77, while revenue reached $688 million, above the forecast of $680.33 million. Despite these positive figures, Okta’s stock experienced a decline, reflecting investor concerns over future guidance amid economic uncertainties. The company continues to innovate with new products in AI and identity security, maintaining its position as a leader in the identity management sector.
Okta’s financial health remains strong, with a 12% year-over-year revenue growth and a projected non-GAAP operating margin of 25% for the fiscal year. Analysts have noted the company’s cautious approach to future guidance due to macroeconomic challenges. However, Okta’s investment in product innovation and identity security enhancements positions it well for future growth. The firm has also seen significant gains in its large enterprise market segment, demonstrating its ability to deliver robust results despite challenging economic conditions.
Additionally, Okta’s strategic focus on identity security as a first line of defense has been emphasized by CEO Todd McKinnon. The company remains committed to ongoing product innovation, as highlighted in its recent showcase event. CFO Brett Tye expressed confidence in Okta’s future, noting the company’s strategic commitment and investments in the public sector as a positive indicator for long-term growth.
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