Investors Are Buying Okta Stock Thursday Morning: What's Going On?

Okta Inc OKTA shares are getting a lift Thursday after the company reported strong first-quarter financial results and issued upbeat guidance. Evercore ISI also upgraded the stock following the print.

• Q1 Revenue: $617 million, versus estimates of $604.339 million

• Q1 EPS: 65 cents, versus estimates of 55 cents

Total revenue was up 19% on a year-over-year basis. Subscription revenues came in at $603 million, up 20% on a year-over-year basis. Current remaining performance obligations totaled $1.949 billion at the quarter end, up 15% year-over-year.

Outlook: Okta sees fiscal second-quarter revenue in the range of $631 million to $633 million versus estimates of $615.824 million. The company anticipates second-quarter adjusted earnings of 60 to 61 cents per share versus estimates of 54 cents per share. 

Okta also raised its full-year guidance. Okta now sees full-year revenue in the range of $2.53 billion to $2.54 billion versus estimates of $2.508 billion. The company now expects full-year adjusted earnings to be between $2.35 and $2.40 per share versus estimates of $2.32 per share.

“We began the new fiscal year with record non-GAAP profitability and cash flow as we continue to benefit from the operating efficiency actions we've taken over the past several quarters,” said Todd McKinnon, co-founder and CEO of Okta.

“With the advancements we've made on Okta's Secure Identity Commitment and our growing product pipeline, we remain well positioned to advance our market leadership position and win more of the massive opportunity in both the workforce and customer identity markets.”

Following the print, Evercore ISI Group analyst Peter Levine upgraded Okta from In-Line to Outperform and raised the price target from $102 to $122. Needham analyst Alex Henderson reiterated a Buy rating and maintained a price target of $130.

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OKTA Price Action: Okta shares were up 4.3% at $100.50 at the time of writing, according to Benzinga Pro.

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