Okta Shares Rise 13% Post Q4 Earnings: Should You Invest Now?

Okta OKTA shares have appreciated 12.5% following the fourth-quarter fiscal 2026 results on March 4. The company reported earnings of 90 cents per share, which beat the Zacks Consensus Estimate by 6.36% and increased 15.4% year over year. Total revenues increased 11.6% year over year to $761 million, surpassing the consensus mark by 1.59%.

Okta’s prospects benefit from an expanding clientele, driven by an innovative product pipeline and strong demand for Identity solutions. Customers with more than $100K in Annual Contract Value increased 6% year over year to 5,100. OKTA ended fiscal 2026 with more than 20,000 customers.

These factors are expected to help OKTA shares recover, which have dropped 23.2% in the trailing 12 months, underperforming the broader Zacks Computer & Technology sector and peers, including Microsoft MSFT, Palo Alto Networks PANW and Cisco Systems CSCO. Over the same timeframe, the broader sector, Cisco and Microsoft have returned 33.6%, 26.7% and 7.6%, respectively, while Palo Alto Networks has dropped 5%.

OKTA Stock’s Performance

OKTA Offers Positive FY27 Guidance

For fiscal 2027, OKTA expects revenues between $3.17 billion and $3.19 billion, indicating 9% growth from the figure reported in fiscal 2026. Okta expects fiscal 2027 non-GAAP earnings between $3.74 and $3.82 per share. 

The Zacks Consensus Estimate for Okta’s earnings has increased by a nickel to $3.71 per share over the past 30 days. The earnings estimate suggests 6% growth over the figure reported in fiscal 2026. The consensus estimate for revenues is currently pegged at $3.18 billion, suggesting 9% growth from the figure reported in fiscal 2026.

Okta, Inc. Price and Consensus

 

Okta, Inc. price-consensus-chart | Okta, Inc. Quote

Okta expects first-quarter fiscal 2027 revenues between $749 million and $753 million, indicating 9% year-over-year growth. Okta anticipates non-GAAP earnings between 84 cents and 86 cents per share.

For the first quarter of fiscal 2027, the Zacks Consensus Estimate for OKTA’s earnings has been unchanged at 87 cents per share over the past 30 days. The earnings estimate suggests 1.2% year-over-year growth.

OKTA Rides on Strong Portfolio & Rich Partner Base

Okta’s strong portfolio that includes new offerings, including Okta Identity Governance (“OIG”), Okta Privileged Access, Okta Device Access, Identity Security Posture Management, Identity Threat Protection with Okta AI, Fine-Grained Authorization, Auth0 for AI Agents and Okta for AI Agents. These new solutions are helping OKTA gain market share and drive top-line growth. These new products represented 30% of fiscal fourth-quarter bookings.

The company is benefiting from OIG’s strong traction, which at the end of the fiscal fourth quarter had 2000 customers. Okta’s neutral and independent identity solution secures and governs the entire agentic life cycle. It gives customers the freedom to deploy on any agent platform without ecosystem lock-in. Auth0 and Okta for AI Agents treat AI agents with the same importance as humans and give customers everything they need to secure the deployment of agentic AI technology.

Okta is benefiting from a rich partner base that includes the likes of Amazon Web Services (“AWS”), CrowdStrike, Google, LexisNexis Risk Solutions, Microsoft, Netskope, Palo Alto Networks, Plaid, Proofpoint, Salesforce, ServiceNow, VMware, Workday, Yubico and Zscaler. Okta and Palo Alto Networks have expanded their partnership that combines Okta Workforce Identity and Palo Alto Networks’ Prisma Access Browser. Integration between Identity Threat Protection with Okta AI and Palo Alto Networks AI-driven Cortex SecOps platform offers organizations a unified view of identity-related risks across their entire attack surface.

Okta’s channel partners were engaged in 18 of the company’s top 20 deals in the fourth quarter of fiscal 2026. Total contract value generated through AWS Marketplace grew more than 45% in fiscal 2026 to approximately $750 million.

Here’s Why OKTA Is a Buy Now

OKTA’s innovative portfolio and rich partner base are helping the company win clients. These drivers also justify a premium valuation as suggested by the Value Score of D.

In terms of forward 12-month price/sales (P/S), Okta is trading at 4.46X, close to a median of 5.31X. However, OKTA is cheaper than Microsoft, Cisco and Palo Alto Networks, shares of which are trading at 8.45X, 4.92X, and 10.78X, respectively.

OKTA Stock’s Valuation

Okta currently sports a Zacks Rank #1 (Strong Buy), which implies that investors should start accumulating the stock right now. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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