Key Stats for Okta Stock
- Pre-market Price Change for Okta stock: -4%
- $OKTA Share Price as of Dec. 2: $82
- 52-Week High: $128
- $OKTA Stock Price Target: $118
Now Live: Discover how much upside your favorite stocks could have using TIKR’s new Valuation Model (It’s free)>>>
What Happened?
Okta (OKTA) stock dropped over 3% in pre-market despite beating Wall Street expectations for the third quarter. The identity management company reported adjusted earnings of $0.82 per share on revenue of $742 million, both ahead of analyst estimates.
Revenue jumped nearly 12% compared to last year’s third quarter, while net income surged 169% to $43 million. Subscription revenue, which makes up most of the business, grew 11% to $724 million.
So why did Okta stock fall? The company didn’t provide preliminary guidance for fiscal 2027, breaking from its usual pattern.
CFO Brett Tighe explained that the company’s fourth quarter is seasonally large, making it difficult to forecast next year without adding extra conservatism that wouldn’t be helpful to investors.
During the earnings call, management highlighted strong momentum in AI agent security, a new market they believe could become bigger than their current addressable market.
The company launched Auth0 for AI agents and Okta for AI agents to help businesses build and manage secure AI systems.
CEO Todd McKinnon noted they’ve already engaged with over 100 customers representing more than $200 million in existing revenue.
See analysts’ growth forecasts and price targets for OKTA stock (It’s free!) >>>
What the Market Is Telling Us About OKTA Stock
The market’s reaction suggests investors are more focused on the lack of forward guidance than the solid quarterly results.
However, the company’s business fundamentals remain strong, with sales productivity improving, average sales rep tenure at a multiyear high, and attrition at a multiyear low. Management expressed confidence by adding sales capacity for the first time in years.
The AI agent security opportunity represents significant long-term potential. During the quarter, Okta closed deals in which customers are deploying AI agents across their operations and need robust security governance.
One financial services customer added Okta for AI agents to their existing contract, resulting in a meaningful increase in annual contract value.
While Okta stock may face near-term volatility due to guidance uncertainty, the company is positioning itself to capture an emerging market that could drive growth for years to come.
Investors will get more clarity on fiscal 2027 expectations when the company reports fourth-quarter results in early 2025.
Estimate a company’s fair value instantly (Free with TIKR) >>>
How Much Upside Does Okta Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
