Okta, Inc (OKTA) PT Lowered to $130 at Wolfe Research

Wolfe Research analyst Alex Zukin lowered the price target on Okta, Inc (NASDAQ: OKTA) to $130.00 (from $140.00) while maintaining a Outperform rating.

The analyst comments "OKTA traded down ~13% following the company's F1Q26 earnings print after market close. Prior to the print, shares were up +59% YTD versus the IGV +4% and our All Security Index +11%. Over the last three months, OKTA shares were up 41% (prior to the AH move) versus the IGV +8% and our All Security Index +5%. As a result of the print, we are maintaining our total revenue estimates in FY26 and FY27 and still model full year growth for each period of 9.4% and 8.2%, respectively. On cRPO, OKTA guided to F2Q growth of 10.4%. For FY26 and FY27, we now model cRPO of $2.409B and $2.594B, representing growth of 7.2% and 7.7% (versus 7.8% and 8.5% prior). Finally, on margins, our updated estimates for FY26 operating margins of 25% are in line with managements guidance (vs. ~25% prior), and we now model FY27 operating margins of 26.3%, up 10bps from 26.2% prior, and on FCF margins our FY26 estimates are in line with managements FY26 outlook of 27% (26% prior) and we model FY27 FCF margins of 28.3% (up from 27.4% prior). On CY26 Revenue, OKTA trades at 6x, including the after hours move, which is above its average one and three-year multiples of ~5x but below its five-year average FY +2 revenue multiple of ~12x. On CY26E FCF, the stock trades at ~21x on base case estimates (~18x on upside), which is below its one-year average FCF multiple of ~22.5x. Compared to our Middleweight Efficiency comp group (CY25 Revenue Growth + FCF Margin between 20% and 40%), which trades at a median CY26 FCF multiple of ~24x, OKTA trades at a 12% discount at 21x, which we feel is unwarranted given we expect OKTA to finish this year as a Rule of 40+ company. While we do view the guidance as conservative for next quarter and the full year (FY26) and see upside to both the revenue and FCF margin outlook, we think the lower beats in F1Q and the F2Q cRPO guidance being below consensus estimates slightly damped investor confidence in the true levels of upside for this year. Our $130 PT implies CY26E base case Revenue and FCF multiples of 7.2x and 25.6x (6.7x and 21x upside estimates). OKTA remains Outperform rated."

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