TLDR
- BMO Capital Markets elevated Okta (OKTA) to Outperform from Market Perform while boosting its price objective to $97
- Bernstein increased its price objective to $134 from $129 while keeping its Outperform stance
- Fourth-quarter fiscal 2026 subscription revenue climbed 11.5% compared to the previous year, surpassing guidance by $12 million
- Platform-based bookings represented 30% of fourth-quarter total, a significant jump from the 10–15% range in prior quarters
- Several Wall Street firms revised their price objectives, with targets spanning from $80 to $134
Friday proved eventful for Okta shareholders. Before the opening bell, the identity management company received favorable analyst attention through upgrades and revised price objectives, pushing shares modestly higher during morning trading.
BMO Capital Markets analyst Keith Bachman elevated his stance on Okta to Outperform from Market Perform while simultaneously lifting his price objective to $97. Bachman emphasized the strategic importance of identity management in the expanding landscape of artificial intelligence agents.
“We believe identity management is critical for agent adoption, and we think Okta will be one of the companies that nurtures, and benefits from, agent growth,” Bachman wrote.
Bachman further highlighted that Okta’s Identity Governance offering presents substantial growth opportunities ahead. BMO’s analysis suggests Okta stands a good chance of achieving stable to slightly improved subscription revenue expansion in fiscal 2027 versus fiscal 2026.
Meanwhile, Bernstein elevated its price objective on Okta to $134 from $129 while reaffirming its Outperform recommendation. The firm cited the company’s fourth-quarter fiscal 2026 performance as the catalyst.
Subscription revenue at Okta accelerated 11.5% year-over-year during the fourth quarter, an improvement from the 11.2% growth rate posted in the preceding period. The company exceeded the midpoint of management’s own projections by $12 million.
What Drove the Q4 Beat
Bernstein identified three key factors behind the robust quarterly performance. First, accelerating traction in net customer additions combined with minimal attrition rates. Second, sustained appetite for Okta’s comprehensive platform offerings. Third, the company cycling through challenges related to large three-year contracts executed during the pandemic era.
One metric particularly caught attention. Platform-oriented bookings comprised 30% of fourth-quarter bookings, a notable increase from the 10–15% range observed in recent periods. This transition carries significance as it indicates customers are embracing a broader array of Okta’s solutions beyond just the core product.
Bernstein additionally observed that these positive results materialized despite pressures from federal government downsizing initiatives connected to DOGE. This headwind potentially impacted Okta by approximately $30 million in annual recurring revenue during the third quarter.
Okta currently maintains a gross profit margin of 77%, while its PEG ratio registers at 0.03, which InvestingPro characterizes as undervalued.
Where Other Analysts Stand
Not every Wall Street response to Okta’s latest quarterly showing proved equally enthusiastic.
D.A. Davidson maintained its Buy recommendation with a $110 price objective intact. Needham preserved its Buy rating while reducing its target to $90, pointing to management’s prudent forward guidance. Stephens decreased its objective to $95 while retaining an Overweight rating.
Scotiabank reduced its target to $80 while keeping a Sector Perform designation. Wolfe Research lowered its objective to $90 but maintained an Outperform rating.
For fiscal 2027, Okta provided guidance projecting approximately 10% subscription revenue growth year-over-year, marginally above Wall Street consensus though still perceived as conservative by certain analysts.
