Okta (OKTA) Outpaces Stock Market Gains: What You Should Know
Okta (OKTA) closed at $253.12 in the latest trading session, marking a +0.91% move from the prior day. This change outpaced the S&P 500's 0.55% gain on the day. Elsewhere, the Dow gained 0.18%, while the tech-heavy Nasdaq added 1.03%.
Heading into today, shares of the cloud identity management company had gained 1.23% over the past month, lagging the Computer and Technology sector's gain of 2.96% and the S&P 500's gain of 3.13% in that time.
OKTA will be looking to display strength as it nears its next earnings release. In that report, analysts expect OKTA to post earnings of -$0.01 per share. This would mark no growth from the year-ago period. Our most recent consensus estimate is calling for quarterly revenue of $221.61 million, up 32.44% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.04 per share and revenue of $822.18 million. These totals would mark changes of +112.9% and +40.29%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for OKTA. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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 remained stagnant. OKTA currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that OKTA has a Forward P/E ratio of 6101.27 right now. For comparison, its industry has an average Forward P/E of 32.69, which means OKTA is trading at a premium to the group.
Investors should also note that OKTA has a PEG ratio of 244.05 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software and Services industry currently had an average PEG ratio of 14.39 as of yesterday's close.
The Internet - Software and Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 198, putting it in the bottom 23% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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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