|Bid||118.98 x 900|
|Ask||0.00 x 800|
|Day's Range||119.50 - 123.90|
|52 Week Range||41.88 - 136.61|
|Beta (3Y Monthly)||1.06|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||117.65|
(Bloomberg Opinion) -- Slack Technologies Inc. couldn’t have picked a better time to go public. Investors have lost their minds about software companies.Earlier this year, I wrote about how stock buyers were willing to pay handsomely to own shares of fast-growing companies that sell cloud software to businesses. As investors had grown antsy about the FAANGs — the elite technology superpowers such as Apple Inc. and Google parent company Alphabet Inc. — the software PUTIN stocks, as I semi-apologetically called them,(1)were ascendant. Since then, investors have warmly greeted new stock listings by even more business software firms including Zoom Video Communications Inc., Pagerduty Inc. and CrowdStrike Holdings Inc.I went back to my self-selected cohort of 17 business software firms that included Salesforce, Adobe, Atlassian and ServiceNow. The median stock multiple of my cohort, which I had to adjust slightly because of acquisitions, didn’t budge much since the February analysis.The median market value adjusted for cash and debt was about 10.3 times a blend of revenue estimated in the next year, compared with 9.8 times in February. The price-to-earnings multiple of the S&P 500 index has also increased since then.(5) What really stood out was the top-tier companies in my PUTIN index have grown even more bubbly.Look behind the velvet rope to find the 20x Club, the most popular hot spot in stock markets. More than half a dozen software firms now have enterprise values that are more than 20 times expected revenue in the next year, according to Bloomberg data.That is — to put it mildly — not normal. Relative to revenue, buying a share of pharmaceutical software firm Veeva Systems Inc., a member of the 20x Club, is four times the price of Alphabet, one of the dominant companies of this generation. Some of the members of the 20x Club are newly public, and it’s not unusual to see young companies with stock market values that are a bit out of whack. But 20x Club members also include Veeva, Atlassian Corp., Okta Inc., MongoDB and other companies that have been public for 18 months or more. As corporate-messaging service Slack plans to list its shares Thursday in a not-IPO,(2)it may join this elite crew. A valuation for Slack of $17 billion or so would work out to an enterprise value to forward revenue in the ballpark of the 20x Club.There are understandable reasons these business software firms, which are relatively unknown by normal humans, have become darlings of the stock market and technology investing. Something real and seemingly permanent is changing in how companies large and small buy technology. Companies are desperate to modernize their technology so they don’t get left behind and can take advantage of growth opportunities, and that has made them open their wallets to buy new types of internet-friendly, easy-to-use software that promises to help make their marketing spending more efficient, catch cyberattacks before they cripple systems or enable seamless communications among far-flung employees.I’m not yet convinced that these young cloud software companies can ever grow as large as their investors believe, particularly if an economic downturn forces companies to rationalize their technology budgets. But software truly is eating the world, and that has accrued to the benefit of both titans such as Microsoft and relative newcomers like the members of the 20x Club.At the same time, investors are desperate for growth, and business software firms are delivering it in spades. They can also be relatively easy to understand — they sell software in exchange for cash — and businesses have proved to be relatively reliable consumers, unlike people and their tendency to flit from one hot internet thing to the next. And now that superstar tech companies have run into regulatory problems, been hit with tariffs or otherwise have more question marks than before, a bet on a company selling software that an antitrust lawyer would never notice suddenly looks like a good idea. The question is what that promise costs. As stock buyers pay more relative to a company’s revenue, any wobble in growth can result in a crash, and investors’ room for error narrows when stock prices are already high relative to a company’s financial prospects. High stock valuations may also deter some needed consolidation in business software. It has become fashionable not to care about valuation, but there can be a high price to bubbles in share prices. Of course, I could have called a bubble in business software stocks at multiple points in the last decade and it would have been accurate in the moment yet completely wrong. An index of mostly business software companies, the BVP Nasdaq Emerging Cloud Index, has more than quintupled since 2013, compared with a 74% gain for the S&P 500 over the same period. It’s true that 10 years into an unprecedented bull market in stocks, unusual valuations are par for the course. Maybe the bubble for business software firms will never end, or stock prices of these highflying software firms will deflate slowly rather than blow up. Maybe. Or there may be a high price to pay for software companies in an unprecedented stratosphere. (1) No, I am not sorry at all. I will say, however, that the "U" in PUTINs, Ultimate Software Group Inc., was sold in May to an investor group. My acronym is broken.(2) Yes, these software companies tend to be valued as a multiple of revenue rather than profits. In many cases they don't have profits.(3) Bloomberg Beta, the venture capital arm of Bloomberg Opinion parent Bloomberg LP, is an investor in Slack.To contact the author of this story: Shira Ovide at firstname.lastname@example.orgTo contact the editor responsible for this story: Daniel Niemi at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shira Ovide is a Bloomberg Opinion columnist covering technology. She previously was a reporter for the Wall Street Journal.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Okta, Inc. (OKTA), the leading independent provider of identity for the enterprise, announced the addition of Robert L. Dixon, Jr., former Global Chief Information Officer and Senior Vice President of PepsiCo, Inc. to its board of directors, effective June 14. “Robert’s knowledge and expertise as CIO of one of the world’s most recognizable and successful brands will bring invaluable insight not only to Okta’s board of directors, but to our organization as a whole as we execute on our vision of enabling any organization to use any technology,” said Todd McKinnon, Chief Executive Officer and co-founder, Okta.
Despite huge spending on cybersecurity, data breaches continue. But new "zero trust" models could usurp firewalls as the best way to stop cyberattacks and ensure insiders are secure.
Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industry and media insiders on top of that. Individual investors can piggyback […]
Are High-Growth Tech Stocks Attractive after Recent Pullback?(Continued from Prior Part)Okta stock Okta (OKTA), an enterprise identity management service provider, has generated staggering returns since its IPO in April 2017. Okta stock has risen
There are a number of reasons that attract investors towards large-cap companies such as Okta, Inc. (NASDAQ:OKTA...
May was a red month for global equities as escalating trade tensions and the worry of slowing economic growth pushed investors to sell risky assets and pile into the bond market. As a result, stocks fell sharply in May, while bonds rallied.But while the May market selloff was broad, it didn't take down every single stock in the market. Instead, there were a handful of stocks which actually rallied in May and recorded new all-time highs while the market was plunging.What was so special about this group of stocks? For one reason or another, these stocks just didn't and still don't care about tariffs. Some of these stocks are defensive in nature, so they rallied as investors tried to play defense. Others don't have much exposure to the trade war. And some of these stocks are supported by businesses with more than enough growth momentum to offset any trade-related weakness.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBroadly, these stocks ignored rising trade conflicts and marched higher.They will continue to do so for the foreseeable future. As such, as global trade conflicts stick around over the next few months, the smart move is to pile into the stocks which can head higher even against that dour backdrop. * 10 Stocks to Buy That Could Be Takeover Targets Which stocks are those? Let's take a deeper look at 7 stocks to buy that don't care about tariffs. Okta (OKTA)Investment Style: Secular Growth% Gain Since May 1: 17%At All-Time High? YesBull Thesis: You want to buy hyper-growth cloud company Okta (NASDAQ:OKTA) here because this is a secular growth stock with a robust growth narrative that simultaneously isn't slowing, lacks exposure to trade headwinds, and could actually benefit from a domestic economic slowdown.In a nutshell, Okta provides identity-based cloud security solutions for enterprises. This growth narrative is on fire right now (Okta reported 50%-plus revenue growth last quarter), and won't slow anytime soon. There are no trade headwinds here since Okta is a service business, and services have been exempt from trade talk thus far. Further, security spend is one thing that probably won't get hit in an economic slowdown, so this company's business model is fairly resilient to economic slowing.Overall, then, Okta is a red hot growth stock to buy now as it should remain red hot for the foreseeable future. American Electric Power (AEP)Source: Robert via FlickrInvestment Style: Defensive% Gain Since May 1: 5%At All-Time High? YesBull Thesis: With respect to utility giant American Electric Power (NYSE:AEP), AEP stock looks good here because this company is as stable as it gets, is relatively resilient to an economic slowdown, and lacks exposure to anything trade-related, while the stock's yield is big and increasingly attractive as fixed-income yields plunge.When it comes to operational stability, American Electric Power is second to none. The company provides electric services to U.S. consumers. Demand for those services will not wane anytime soon. Further, trade is a non-issue here, and the stock has a nice big 3% dividend yield, which is presently as far above the 10-Year Treasury yield as it has been since late 2017. * 7 Ways to Make Berkshire Hathaway Stock More Attractive Overall, AEP stock is a stable stock with a big yield, and as such, is a high quality defensive stock to buy in today's volatile market. Dollar General (DG)Source: Shutterstock Investment Style: Defensive & Stable% Gain Since May 1: 5%At All Time High? YesBull Thesis: You want to buy off-price retail giant Dollar General (NYSE:DG) here because the company is firing on all cylinders today and should continue to fire on all cylinders for the foreseeable future -- even if the U.S. economy slows meaningfully.Retail had a rough start to 2019. The consumer weakened in the first quarter of 2019, and retailers felt that weakening. Across the sector, retailers put up ugly first quarter 2019 numbers. Not Dollar General. The dollar store giant's first quarter numbers were really good. Why the discrepancy? Because although the consumer may have weakened in early 2019, the off-price retail strategy still worked, mostly because the consumer's affinity for lower prices doesn't go lower when times get tough.If anything, it goes up. As such, with economic turbulence on the horizon, Dollar General has visibility to gain share and traffic over the next few quarters. That makes DG stock a solid buy here. Coupa (COUP)Investment Style: Secular Growth% Gain Since May 1: 14%At All-Time High? YesBull Thesis: Hyper-growth cloud company Coupa (NASDAQ:COUP) looks good here because this company is firing on all cylinders right now with a solution that could become increasingly attractive in an economic slowdown and in a market supported by secular growth tailwinds which won't let up anytime soon.Coupa offers a cloud-based enterprise solution which is broadly aimed at helping companies become more efficient with their spend. Enterprises really like the Coupa solution. That's why this company has reported 30%-plus revenue growth for the past several quarters. Demand won't falter because of a slowing economy. If anything, a slowing economy will push demand higher since companies will increasingly want to optimize spend when dollars become more scarce. * 7 S&P 500 Dividend Stocks to Buy at Least Yielding 3% As such, this is a hyper-growth cloud company that should remain on a healthy growth trajectory for the foreseeable future. That makes COUP stock a good buy here. Coca-Cola (KO)Source: Chris Nielsen via FlickrInvestment Style: Defensive% Gain Since May 1: 5%At All-Time High? YesBull Thesis: When it comes to beverage giant Coca-Cola (NYSE:KO), you buy KO stock here for largely unparalleled defense to a global economic slowdown on top of a big yield which is becoming increasingly attractive as yields elsewhere plunge.Consumers need to drink. Regardless of the economic backdrop -- super fast growth, super slow growth, or something in the middle -- consumers across the globe need to drink. Coca-Cola is the heartbeat of the global beverage industry. As such, regardless of how the global economy develops over the next several quarters, Coca-Cola's numbers should remain largely stable and resilient to any slowdown. At the same time, KO stock has a juicy 3% dividend yield which is as far above the 10-Year Treasury Yield as it's been since mid-2017.Thus, in the big picture, Coca-Cola is a big and stable company with a big and stable yield. That combination makes KO stock a strong defensive stock to buy in volatile times. Shopify (SHOP)Source: Shopify via FlickrInvestment Style: Secular Growth% Gain Since May 1: 19%At All-Time High? YesBull Thesis: E-commerce solutions provider Shopify (NYSE:SHOP) is on fire right now, and you want to buy SHOP stock here because this fire won't die anytime soon, regardless of how the economic currents change.Shopify is enabling an entire new generation of individual and small-to-medium sized retailers to compete in the direct retail channel with the likes of Walmart (NYSE:WMT) and Amazon (NASDAQ:AMZN). This growth narrative has caught fire over the past few quarters as the e-retail market has become increasingly decentralized. This fire won't die anytime soon. The secular growth narrative of Shopify pioneering a new era of decentralized direct retail is simply too powerful to be weighed down by tariffs. That's why this company reported 50% gross merchandise sales growth last quarter in the face of tariffs. * The 10 Best Stocks for 2019 -- So Far So long as this secular growth narrative maintains robust momentum, SHOP stock will continue to march higher. Roku (ROKU)Source: Shutterstock Investment Style: Secular Growth% Gain Since May 1: 60%At All Time High? YesBull Thesis: You want to buy OTT video platform Roku (NASDAQ:ROKU) here because the company's secular growth narrative is powerful enough to offset slowing economic growth headwinds, and such headwinds could actually provide a lift to the company's user growth.The big idea at Roku is that this company is becoming the cable box of the OTT video world. That world is rapidly growing, and it won't stop growing because of an economic slowdown. If anything, growth will be supercharged by a slowdown. Consumers will finally be moved to cut expensive cable packages in bulk, and pivot towards much cheaper streaming options. Thus, the Roku growth narrative is not jut red hot right now, but could actually get even hotter if the economy slows.Because of this, Roku stock looks good here. You have a stock that's firing on all cylinders without any material headwinds on the horizon.As of this writing, Luke Lango was long OKTA, AEP, DG, SHOP, WMT, AMZN, and ROKU. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * The 4 FANG Stocks Won't Be Bitten By Regulation Threats * 10 Stocks to Buy That Could Be Takeover Targets * 4 Big Bank Stocks Rebounding Compare Brokers The post 7 Stocks to Buy That Don't Care About Tariffs appeared first on InvestorPlace.
The path to profitability had better be short if Uber wants to stop hemorrhaging money; plus more earnings from tech, retail, and more.
For his "Executive Decision" segment of Mad Money Friday night, Jim Cramer spoke with Todd McKinnon, CEO of Okta Inc. McKinnon said Okta has over 6,500 customers across the globe and they're working hard to protect each and every one. The CEO explained many of their customers need a simple, yet secure, user experience.
Hedge funds are not perfect. They have their bad picks just like everyone else. Facebook, a stock hedge funds have loved dearly, lost nearly 40% of its value at one point in 2018. Although hedge funds are not perfect, their consensus picks do deliver solid returns. Our data show the top 20 S&P 500 stocks […]
The cloud identity management company beat Wall Street's first quarter financial forecasts and gave investors a solid forecast for the year. The cloud computing services company issued a weaker-than-expected profit and revenue forecast for the current quarter. The clothing and apparel retailer's first quarter financial results fell short of Wall Street forecasts and it slashed its profit forecast for the year.
The Suynnyvale could be valued as high as $4.5 billion and would be only the seventh venture-backed U.S. cybersecurity business to be valued at more than $1 billion in its Wall Street debut.
Shares of Okta, which sells cloud software for identity and access management, shot up around 7% on Friday after it trounced Wall Street's expectations for revenue and posted a narrower-than-expected loss. For the quarter, Okta reported quarterly revenue of $125 million for the quarter, up 50% from one year ago and ahead of analysts' estimates. "At our scale, that's really strong growth," Okta CEO Todd McKinnon told TheStreet.
Shares of identity recognition security software maker Okta rise after the company reports a narrower-than-expected fiscal first-quarter loss.
Yahoo Finance's Adam Shapiro and Jared Blikre discuss the earnings reports for Okta, VMWare, and Dell.
Software company Okta reported record revenue in the first quarter, surging to $125.2 million. Yahoo Finance's Akiko Fujita, Dan Roberts, and Kristin Myers discuss.