Here's Why Analysts Are Positive On Okta With Hint Of Caution

Analysts had optimistic views on Okta, Inc OKTA with a tinge of caution post Q1 beat.

JMP analyst Trevor Walsh maintained a Market Outperform rating though lower price target to $165 (based on multiple compression across the sector and macroenvironment volatility) from $260 on Okta post Q1 FY23 results.

The stock traded up during the aftermarket, on top of an already notable uptick during the day, partly due to the company's resilience in overcoming the pressures from March's security incident and guidance to suggest an improving top line. 

Mizuho analyst Gregg Moskowitz reiterated a Buy with a price target of $165. Despite significant investor concerns heading into Okta's Q1 print due primarily to macro uncertainty and the recent LAPSUS$ breach, the company delivered excellent results.

While profitability remains an issue, Okta's organic growth remains strong, and Auth0 growth remains robust. Okta's technological and GTM advantages versus most peers were significant.

Needham analyst Alex Henderson had a Buy rating with a price target of $135. Okta shares traded up on the Q1 print, reflecting relief over concerns about the potential impact of a poorly handled CYQ1 hack. 

Consistent with his field checks and preview note commentary, there was no appreciable impact on the quarter, the pipeline, and the company's potential growth. 

Okta delivered a strong quarter with Revenue, RPO, cRPO, Calculated Billings, DBNR, Gross Margin, Operating Margin, and EPS all ahead of forecast. Okta raised guidance for the year, exceeding his and the Street estimate, and trimmed the expected EPS loss. 

Raymond James analyst Adam Tindle maintained a Market Perform rating on Okta following Q1 results ahead on most metrics and FY23 guidance that leaves his model largely intact on growth with profitability slightly better. 

The stock has essentially been cut in half YTD with the majority over the past few months, and results may rightfully result in some relief from incessant selling. He chose to remain on the sidelines. 

Price Action: OKTA shares traded higher by 6.16% at $99.46 on the last check Friday.