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Okta (OKTA) Gains As Market Dips: What You Should Know

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Okta (OKTA - Free Report) ended the recent trading session at $77.93, demonstrating a +1.84% swing from the preceding day's closing price. The stock outpaced the S&P 500's daily loss of 0.21%. At the same time, the Dow lost 0.14%, and the tech-heavy Nasdaq lost 0.05%.

The the stock of cloud identity management company has risen by 4.34% in the past month, lagging the Computer and Technology sector's gain of 9.62% and the S&P 500's gain of 5.94%.

Analysts and investors alike will be keeping a close eye on the performance of Okta in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.57, indicating a 29.55% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $649.35 million, indicating a 11.19% upward movement from the same quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.59 per share and a revenue of $2.56 billion, representing changes of +61.88% and +13.1%, respectively, from the prior year.

Any recent changes to analyst estimates for Okta should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 57.49% upward. At present, Okta boasts a Zacks Rank of #1 (Strong Buy).

Looking at valuation, Okta is presently trading at a Forward P/E ratio of 29.53. Its industry sports an average Forward P/E of 20.55, so one might conclude that Okta is trading at a premium comparatively.

Also, we should mention that OKTA has a PEG ratio of 1.28. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Software and Services industry currently had an average PEG ratio of 1.72 as of yesterday's close.

The Internet - Software and Services industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 175, finds itself in the bottom 31% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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