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

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In the latest trading session, Okta (OKTA - Free Report) closed at $85.67, marking a +1.75% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 0.21% for the day. On the other hand, the Dow registered a loss of 0.16%, and the technology-centric Nasdaq decreased by 0.89%.

Prior to today's trading, shares of the cloud identity management company had gained 3.43% over the past month. This has outpaced the Computer and Technology sector's loss of 2.15% and the S&P 500's loss of 1.56% in that time.

Analysts and investors alike will be keeping a close eye on the performance of Okta in its upcoming earnings disclosure. In that report, analysts expect Okta to post earnings of $0.73 per share. This would mark year-over-year growth of 15.87%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $668.8 million, up 10.55% from the year-ago period.

OKTA's full-year Zacks Consensus Estimates are calling for earnings of $2.77 per share and revenue of $2.6 billion. These results would represent year-over-year changes of +73.13% and +14.75%, respectively.

It's also important for investors to be aware of any recent modifications to analyst estimates for Okta. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 4.01% higher. Okta is holding a Zacks Rank of #2 (Buy) right now.

In the context of valuation, Okta is at present trading with a Forward P/E ratio of 30.41. This represents a premium compared to its industry's average Forward P/E of 17.45.

Investors should also note that OKTA has a PEG ratio of 1.28 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Internet - Software and Services industry was having an average PEG ratio of 1.57.

The Internet - Software and Services industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 45, finds itself in the top 18% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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