Last Updated: 09 Nov 2024
Executive Summary
Okta Inc. (OKTA) is a leading provider of identity and access management (IAM) solutions. The company's platform enables organizations to securely manage user access to applications and data across multiple devices and cloud environments. OKTA has a strong track record of growth, with revenue increasing by 16.2% year-over-year in the latest quarter. However, the company is currently unprofitable, with a trailing twelve-month EBITDA loss of $145 million. The stock is trading at a forward P/E ratio of 26.88, which is above the industry average.
Company Overview
Okta was founded in 2009 and is headquartered in San Francisco, California. The company's platform is used by over 14,000 organizations worldwide, including Fortune 500 companies such as Google, IBM, and Salesforce. OKTA's revenue is primarily generated from subscription fees for its software-as-a-service (SaaS) platform.
Fundamental Analysis
Revenue: $2.45 billion TTM
Gross profit: $1.31 billion TTM
Operating income: -$72 million TTM
Net income: -$203 million TTM
Diluted EPS: -$0.81 TTM
Book value per share: $36.11
Okta's revenue has grown steadily over the past several years. In the latest quarter, revenue increased by 16.2% year-over-year to $641 million. The company's gross profit margin is 53.6%, which is in line with the industry average. However, OKTA's operating margin is negative, at -2.9%. The company's net loss widened to $203 million in the latest quarter.
Technical Analysis
52-week high: $114.50
52-week low: $66.69
50-day moving average: $74.41
200-day moving average: $89.61
Okta's stock price has been in a downtrend since reaching a 52-week high of $114.50 in November 2021. The stock is currently trading below its 50-day and 200-day moving averages. The relative strength index (RSI) is at 42.5, which indicates that the stock is oversold.
Short Term Outlook
Okta's stock price is likely to remain under pressure in the short term. The company is facing competition from larger, more established players such as Microsoft and Oracle. Additionally, the company's profitability is a concern.
Long Term Outlook
Okta has a strong market position and a growing customer base. The company is well-positioned to benefit from the increasing demand for IAM solutions. However, the company's profitability is a concern, and the stock is trading at a premium valuation.
Analyst Recommendations
The consensus analyst rating on Okta is "Hold." The average analyst target price is $98.07, which represents a potential upside of 27.7% from the current price.
Conclusion
Okta is a leading provider of IAM solutions. The company has a strong market position and a growing customer base. However, the company is currently unprofitable, and the stock is trading at a premium valuation. Investors should consider the company's long-term growth potential before making an investment decision.
