Okta Climbs On JPMorgan Upgrade Citing Cloud Security Momentum: Retail Divided
By Stocktwits Inc | First Published Dec 16, 2024, 8:32 PM ISTJPMorgan noted that Okta is one of the few prominent pure-play cloud security vendors in the market.
Shares of Okta climbed as much as 3% in early morning trade after JPMorgan upgraded the stock to ‘Overweight’ from ‘Neutral’ while maintaining a price target of $100.
The upgrade comes as Okta reset expectations with a cautious outlook for fiscal 2025, forecasting 7% revenue growth.
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JPMorgan analysts see this as a conservative starting point, positioning the company for potential upside in fiscal 2026.
The firm highlighted Okta’s leadership in identity management solutions, which it described as an increasingly critical focus for organizations as cybersecurity "moves up the priority stack."
The analysts also noted that Okta is one of the few prominent pure-play cloud security vendors in the market.
The brokerage believes the stock's current valuation presents a favorable risk-reward balance, particularly with room for improved financial performance and multiple expansions through better execution.
JPMorgan stated in its note that Okta’s focus on identity management and growing corporate demand for security solutions have strengthened its position in the cloud ecosystem.
Retail sentiment around the Okta stock remained ‘neutral’ with chatter at ‘normal’ levels.
In early December, the company reported third-quarter earnings of $0.67, surpassing the forecasted $0.58. Revenue was $665, a 14% increase over the prior year, beating Wall Street’s estimate of $649.74.
The company expects fourth-quarter revenue to fall between $667 million and $669 million.
Other analysts have had concerns that the Okta’s growth rate is continuing to decelerate.
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