TLDR
- Okta stock rose 21.5% to $163.37 after Q2 fiscal 2027 earnings beat expectations
- Adjusted EPS came in at $1.05 vs. $0.96 expected; revenue hit $805 million, up 10.6% year over year
- Q2 marked Okta’s strongest bookings for any non-fourth-quarter period
- Multiple analysts raised price targets, with Oppenheimer setting a new target of $190
- Okta raised its full-year fiscal 2027 guidance by twice the amount of its Q2 beat
Okta stock jumped 21.5% on Thursday, hitting $163.37, after the company posted a strong second-quarter fiscal 2027 earnings report that beat Wall Street estimates across the board.
Adjusted earnings per share came in at $1.05, topping the $0.96 consensus estimate. Revenue reached $805 million, up 10.6% year over year and ahead of the $793 million analysts expected.
The quarter stood out for its bookings performance. It was Okta’s strongest non-fourth-quarter bookings period on record, and current remaining performance obligations grew 14.1% year over year, accelerating nearly 2 percentage points from the prior quarter.
cRPO is closely watched because it tends to lead revenue growth. That acceleration gave analysts reason to expect continued momentum heading into Q3.
Okta also raised its fiscal 2027 guidance by twice the size of its Q2 beat. The company set full-year EPS guidance at $3.90 to $3.94, and Q3 EPS guidance at $0.92 to $0.94.
Analysts Lift Price Targets
The earnings report triggered a wave of price target increases. Oppenheimer raised its target from $170 to $190 and kept an Outperform rating. KeyBanc moved its target to $190, citing the $76 million beat on cRPO versus expectations. RBC Capital set a target of $195, while DA Davidson also moved to $190.
Bernstein raised its target to $143 from $141, maintaining an Outperform rating, and noted the quarter “finally showed what we’ve been long waiting for” in terms of subscription growth and cRPO acceleration. Piper Sandler raised its target to $160, and Citi set a new target of $165.
The stock currently has a consensus Moderate Buy rating with an average target price of $164.57. Of the analysts covering Okta, 33 have a Buy rating and nine have a Hold.
Okta carries a gross profit margin of 77% and a market cap of $28.4 billion. Its 50-day moving average sits at $139.27, and the 12-month high is $168.50.
Insider Selling Continues
Despite the bullish analyst sentiment, insiders have been selling. Over the past 90 days, insiders sold around 165,000 units of stock valued at approximately $21.8 million.
CFO Brett Tighe sold 65,000 units in June at an average price of $117.25. Insider Eric Kelleher sold just under 4,000 units at $114.10 the same month. Both transactions were executed under pre-arranged Rule 10b5-1 trading plans.
Institutional investors hold 86.64% of the stock. California State Teachers Retirement System made a notable move in Q2, increasing its position by more than 13,000%, now holding over 36 million units valued at roughly $4.95 billion.
The stock’s P/E ratio stands at 119.13. InvestingPro’s Fair Value analysis indicates the stock may be overvalued at current levels.
Okta’s 12-month low was $62.66. The stock has more than doubled from that level following Thursday’s move.
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