TLDR
- Raymond James upgraded Okta from Market Perform to Outperform with an $85 price target
- The upgrade was driven by easing headwinds from downsized renewals tied to COVID-era overprovisioning
- OKTA stock rose 5.1% to $67.35, still near its 52-week low of $62.66
- GuruFocus values OKTA at $102.33, putting current price 34.2% below estimated fair value
- Raymond James sees potential for revenue growth above 10% in fiscal 2027, ahead of Okta’s own guidance of 8.9%
Okta (OKTA) stock jumped 5.1% on April 15 to $67.35 after Raymond James upgraded the identity security company from Market Perform to Outperform, setting a price target of $85.
The stock has had a rough couple of years. It peaked near $200 in fiscal 2023 before tumbling to the $60s, dragged down by a sharp slowdown in net revenue retention â from over 120% to around 106%.
The culprit was a wave of downsized renewals. Customers that over-hired during the COVID boom later cut their headcounts and, with them, their Okta seat counts.
Raymond James now believes that headwind is running out of road. Average contract lengths at Okta run just under three years, which means most of those bloated COVID-era deals have already cycled through.
The firm’s analysis of Okta’s remaining performance obligations and subscription data suggests there could be upside to current growth forecasts.
Raymond James projects revenue growth above 10% in fiscal 2027. That’s ahead of Okta’s own guidance of 8.9%, which leaves room for a positive surprise if the analyst’s thesis plays out.
Valuation Picture
At current prices, Okta trades at roughly 3x enterprise value to revenue and a low double-digit multiple of free cash flow. Its trailing P/E of 51.4x looks elevated, but that’s well below its five-year median of 108x.
The forward P/E sits at 17.8x â a much more grounded number that suggests the market may already be pricing in a more modest growth outlook.
GuruFocus puts Okta’s intrinsic value at $102.33, making the current price a 34.2% discount to that estimate. The firm assigns a GF Score of 69/100, with strong marks for financial strength (8/10) and growth (8/10), but weak scores for profitability (4/10) and momentum (1/10).
Insider activity is worth watching. Over the past three months, insiders sold around $5.1 million worth of stock with no reported buying.
AI Angle
Raymond James flagged AI as a potential tailwind. As enterprises shift from testing AI tools to actually deploying them, AI agents entering the workforce will need their own identity credentials â an area where Okta could expand its footprint.
Other analysts have been broadly positive too. DA Davidson has a Buy rating with a $110 price target. BMO Capital raised its target to $97, and Cantor Fitzgerald reiterated its Overweight rating following Okta’s strong Q4 fiscal 2026 results.
That quarter beat estimates on revenue, current remaining performance obligations, operating margin, and earnings per share.
Okta posted revenue growth of 11.84% over the last twelve months with a gross profit margin of 77.36%.
The stock’s 52-week range runs from $62.66 to $127.57, and at $67.35 it remains close to the bottom of that range.
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