All figures and commentary are as of December 3, 2025. This article is for information only and is not financial advice.
Key takeaways on Okta stock today
- Earnings beat, guidance raised: Okta’s Q3 FY2026 revenue rose 12% year‑over‑year to $742 million, with non‑GAAP EPS of $0.82, both ahead of Wall Street estimates. Free cash flow hit $211 million, a 28% margin. [1]
- Outlook remains solid: Management guided Q4 revenue to $748–$750 million and raised full‑year FY2026 revenue and earnings guidance, now targeting ~11% annual revenue growth and a 26% non‑GAAP operating margin. [2]
- Market reaction has been whiplash‑like: Shares initially dropped about 3–4% in after‑hours and pre‑market trading as investors focused on Okta’s decision not to provide preliminary FY2027 guidance, despite the beat. [3]
- But the stock is bouncing: By mid‑afternoon on December 3, OKTA traded around $86–87, up nearly 6% on the day, after briefly touching a new 52‑week low near $75 earlier in the session. [4]
- Analysts are trimming targets, not abandoning the name: The Street still leans “Buy / Moderate Buy”, with average 12‑month price targets around $113–116, implying roughly 30–40% upside from current levels. [5]
- AI identity is the long‑term story: Okta is positioning itself as the identity “control plane” for AI agents as well as humans, betting that securing machine identities becomes a major growth driver in the next five years. [6]
Okta stock today: price, valuation, and volatility
As of the afternoon of December 3, 2025, Okta, Inc. (NASDAQ: OKTA) is trading around $86.6, up about 5.8% on the day, with a session range of roughly $75.05–$86.89 and a 52‑week range of $75.05–$127.57. [7]
That intraday low just under $75.10 marks a new 52‑week low, underscoring how violently sentiment has swung around the Q3 print. TS2 Tech+1
Key snapshot metrics from today:
- Market cap: about $15.3 billion
- Trailing EPS (GAAP): ~$1.08
- Trailing P/E: ~80x
- Forward P/E: ~24–25x based on FY2026 non‑GAAP EPS around $3.43–$3.44 and today’s share price in the mid‑$80s. [8]
- Beta: ~0.78 (less volatile than many high‑growth peers) [9]
Trading‑wise, Okta has been anything but boring. TradingView notes the stock has logged around 10 daily moves greater than 5% in the past year, and today’s swing from a fresh 52‑week low to a near 6% gain fits that pattern. [10]
Longer term, several analysts and data providers emphasize that despite the recent rebound from pandemic lows, OKTA is still down roughly two‑thirds over the last five years, badly trailing the S&P 500 and sector ETFs. [11]
Inside Okta’s Q3 FY2026 earnings beat
Okta’s third quarter of fiscal 2026 (three months ended October 31, 2025) was, by the numbers, exactly what investors usually say they want from a mature SaaS name: moderate growth, expanding margins, and strong cash generation.
From the company’s official release and follow‑up reporting: [12]
- Total revenue:
- $742 million, up 12% year‑over‑year
- Ahead of estimates around $730–731 million
- Subscription revenue:
- $724 million, up 11%, making up the vast majority of sales
- Remaining performance obligations (RPO):
- Total RPO: $4.292 billion, up 17%
- Current RPO (next 12 months): $2.328 billion, up 13%
- Profitability:
- GAAP operating income of $23 million (~3% margin), versus a loss a year ago
- Non‑GAAP operating income of $178 million (~24% margin), up from ~21%
- GAAP net income $43 million, nearly tripling year‑over‑year
- Non‑GAAP net income $152 million; non‑GAAP EPS $0.82 vs. $0.67 a year ago
- Cash flow & balance sheet:
- Operating cash flow $218 million (~29% of revenue)
- Free cash flow $211 million (~28% margin)
- Cash & short‑term investments $2.46 billion after retiring $510 million of 2025 notes
In other words, Okta has decisively exited its “cash‑burning SaaS” phase. Multiple outlets—from CNBC to specialist sites like TechBuzz and Alphaspread—highlighted the strength in free cash flow, margins and subscription backlog as the key positives from the quarter. [13]
Guidance: strong near‑term, but no FY2027 outlook
The real drama came not from the Q3 numbers, but from guidance.
Q4 FY2026 and full‑year guidance
Management issued guidance that, on its face, looks quite healthy: [14]
- Q4 FY2026 (quarter ending January 2026):
- Revenue: $748–$750 million (≈ 10% growth)
- Non‑GAAP operating margin: ~25%
- Non‑GAAP EPS: $0.84–$0.85
- Free cash flow margin: roughly 31%
- Full‑year FY2026:
- Revenue: $2.906–$2.908 billion, about 11% y/y growth
- Non‑GAAP operating margin: 26%
- Non‑GAAP EPS: $3.43–$3.44
- Free cash flow margin: ~29%
Reuters notes that Q4 revenue guidance came in above Street estimates (~$738 million), and the FY2026 outlook was nudged higher on both revenue and earnings. [15]
The missing FY2027 guidance
So why did the stock initially drop after hours and into pre‑market trading?
Several outlets—including TIKR, CoinCentral, Investors Business Daily, Barron’s and Investing.com—point to the same culprit: Okta did not provide its usual preliminary guidance for the next fiscal year (FY2027). [16]
- CFO Brett Tighe told investors that Q4 is a seasonally large quarter and that issuing early FY2027 numbers would require extra conservatism that might not be helpful. [17]
- Markets interpreted this as a sign that management is not yet ready to stand behind a re‑acceleration in growth, especially with current RPO growing slower (13%) than total RPO (17%), hinting at some near‑term deceleration. [18]
CoinCentral summarized the reaction neatly: Okta beat on revenue, beat on EPS, and raised guidance, yet shares still fell over 3% in after‑hours trading because investors had grown accustomed to the longer‑term outlook that management opted not to provide this time. [19]
CEO Todd McKinnon’s AI message: “AI won’t kill software – it makes identity more important”
Beyond the numbers, Okta’s leadership spent a lot of time this week talking about AI and how it ties into the company’s long‑term identity‑security thesis.
In interviews with MarketWatch, Reuters, and other outlets, CEO Todd McKinnon pushed back against what he sees as two big misconceptions among investors: [20]
- AI will shrink the need for traditional software.
McKinnon argues the opposite: as AI tools proliferate, companies will actually invest more in software and applications, not less, because they need systems to orchestrate, monitor and secure AI‑driven workflows. - AI agents don’t fundamentally change identity.
Okta’s view is that every AI agent—chatbot, workflow bot, or autonomous “agentic” system—needs a robust identity, with rules about what it can access and what it can do. That shifts identity from a human‑only problem to a humans + machines + services problem.
Reuters quotes McKinnon as saying the opportunity to be the “access and identity layer for AI agents and enterprises” could be larger than its current customer and workforce identity businesses combined. [21]
In support of that story, Okta highlighted several product and go‑to‑market moves: [22]
- Launch of “Auth0 for AI Agents” and corresponding features designed specifically to secure non‑human identities
- Growing traction for Okta Identity Governance and other governance products in large enterprises
- A strategic restructuring of the sales organization earlier this year to focus on two core buyers:
- CIOs/CISOs via the Okta platform
- Developers via the Auth0 platform
Computer Weekly notes that nine months after that go‑to‑market shift, Okta is now reporting solid sequential progress, with Q3 showing improved execution, a $4.3B subscription backlog, and expanded margins. [23]
What Wall Street is saying: target cuts, ratings and Okta’s stock forecast
Analyst desks were busy this morning. The headline: targets are being reset lower, but ratings remain mostly positive.
Consensus view
Across major aggregators:
- StockAnalysis: About 39 analysts rate OKTA a “Buy”, with an average 12‑month price target of $116.22, implying roughly 34% upside from today’s ~$86 share price. [24]
- MarketBeat: Consensus rating “Moderate Buy”, with 23 Buys, 13 Holds and 3 Sells and an average target of about $115.94. [25]
- GuruFocus: Compiles 41 analyst targets averaging $113.32, with a high estimate of $145 and a low of $75. The firm calculates this as ~35% upside from a recent price in the mid‑$80s and classifies the average brokerage recommendation as “Outperform” (≈2.2 on a 1–5 scale). [26]
So even after the latest round of target cuts, the median Wall Street forecast still sees meaningful upside from current levels.
Fresh target cuts on December 3
Several firms used the Q3 print to “re‑base” their models:
- Goldman Sachs cut its target from $137 to $117 but maintained a Buy rating, noting that:
- Okta beat on revenue, cRPO and EBIT margin
- The stock’s drop was driven mainly by the lack of FY2027 guidance and concerns about slowing cRPO growth
- Okta still boasts ~77% gross margins, more cash than debt, and low‑double‑digit revenue growth. [27]
- Stifel lowered its target from $130 to $121 while keeping a Buy rating, citing cautious short‑term sentiment despite the strong fundamentals. [28]
- In recent days, J.P. Morgan, Jefferies, Cantor Fitzgerald, Barclays, Mizuho and BMO Capital have all trimmed their targets into the mid‑80s to mid‑110s range while largely maintaining Buy/Overweight/Outperform or Hold/Equal Weight stances. [29]
- BMO Capital, for example, cut its target from about $112 to $90 with a Market Perform rating, citing sector‑wide multiple compression and slightly soft cRPO guidance, even as it acknowledged Okta beat and raised across key metrics. [30]
- Bank of America remains one of the few clear bears, sticking with an Underperform rating and a $75 price target, effectively arguing that the stock is fairly valued or even rich relative to its growth profile. [31]
Bulls vs. skeptics
A sampling of current written research and commentary illustrates the split:
- Bullish camp
- A detailed MarketBeat piece (“Okta: Excuses to Sell Vs. Reasons to Buy”) describes Q3 as a classic “beat‑and‑raise” quarter and argues that modest double‑digit growth, expanding margins and strong cash flow support the case for 50–100% upside over several years if Okta maintains its current trajectory. It also stresses that peers like Palo Alto Networks, Zscaler and CrowdStrike trade at significantly higher valuation multiples. [32]
- A TIKR valuation note from August (“Down Almost 70% From All‑Time Highs, Is Okta Undervalued or a Value Trap?”) models a $118 share price by 2028, implying ~11% annualized returns from levels around $91, assuming continued execution and margin expansion. [33]
- Cautious / skeptical camp
- A recent Alphaspread / Seeking Alpha‑linked analysis highlights that despite the latest beat, Okta shares are still ≈67% below their five‑year highs, and argues that the market is appropriately discounting slower growth and lingering trust issues. [34]
- A new Seeking Alpha article published today (“Okta Q3: I’m Giving Up On This Company”) downgrades the stock to Hold, citing:
- Unimpressive forward guidance
- Slowing cRPO growth
- Stronger top‑line trajectories at competitors such as CyberArk. [35]
In short, most analysts still like Okta as a business, but they disagree on how much growth investors should be willing to pay for in an 11–12% revenue‑growth world.
Institutional flows: big money both buying and selling
Institutional positioning around Okta underscores the split sentiment.
- On December 3, MarketBeat reported that Schroder Investment Management Group increased its Okta stake by 65.9% in Q2, now holding about 290,769 shares (~$29 million). The same report notes that hedge funds and other institutions collectively own about 86.6% of the float, while insiders still hold ~5.7% but have been net sellers (roughly 65,000 shares sold over the last 90 days). [36]
- On the other side, Sands Capital’s Technology Innovators Fund disclosed in its Q3 2025 investor letter that it fully exited its Okta position, choosing to redeploy capital elsewhere in the cybersecurity space. [37]
This mix—significant new institutional buying alongside high‑profile exits—is consistent with a market that is re‑rating but not abandoning the name.
The security overhang: multi‑year breach narrative
One reason sentiment around Okta hasn’t fully recovered is its history of security incidents—painful irony for an identity‑security provider.
- In 2022, Okta disclosed that a breach at third‑party support provider Sitel allowed attackers limited access to its environment. After further analysis, Okta determined that up to 366 customers, roughly 2.5% of its base, were potentially affected over a five‑day window in January 2022. [38]
- A number of security blogs and trade publications criticized Okta’s communication and delay in fully disclosing the scope of the incident, something the company has since acknowledged as a misstep. [39]
- Additional customer‑support‑system issues disclosed in 2023 also forced customers to tighten security and likely dented confidence among some CIOs and CISOs. [40]
Recent articles (including those aggregated by TechStock² and others) argue that this “trust overhang” is still part of the bear case: even if Okta’s technology is strong, some buyers may be reluctant to consolidate more critical workloads with a vendor that has had high‑profile lapses. TS2 Tech+1
Okta’s long‑term identity & AI thesis
Despite those concerns, the strategic bull case for Okta is fairly clear and shows up across multiple analyses: [41]
- Identity remains mission‑critical and durable.
Cyber threats continue to rise and regulators are tightening expectations on access control, especially in highly regulated industries. - AI agents massively increase the identity surface.
Instead of securing just human users and a set of apps, enterprises now need to secure:- Human users
- Traditional apps and services
- Machine identities and AI agents talking to APIs, databases and internal tools
- Okta is trying to be the neutral “identity fabric.”
The company’s bet is that, as a vendor‑neutral cloud platform sitting between users/agents and applications, it can become the control plane for this expanded identity universe, regardless of which AI models (OpenAI, Google, Anthropic, etc.) a customer uses. - Margin structure is already attractive.
With non‑GAAP operating margins guided at 26% and free cash flow margins near 30%, Okta is already in the territory many software companies aspire to reach years down the road. [42]
MarketBeat’s bullish note argues that if Okta can sustain double‑digit earnings growth on top of this margin profile, the current valuation—mid‑20s forward P/E on non‑GAAP numbers—could prove conservative compared with higher‑multiple peers. [43]
Key risks investors are talking about
Today’s commentary also surfaces several risk themes that potential investors should weigh carefully:
- Growth deceleration and cRPO trends
- Q3 showed solid but not explosive growth: 12% revenue growth and 13% cRPO growth.
- Several analysts worry that without a clear path back to mid‑teens or higher growth, Okta may deserve a lower multiple than in the past. [44]
- Competition
- Okta faces pressure from platform vendors (Microsoft, Google) that bundle identity into broader offerings, and specialist rivals like CyberArk and Ping Identity.
- At least one Seeking Alpha analyst explicitly argues that Okta’s growth now lags CyberArk, making the relative opportunity less compelling. [45]
- Security and trust
- The 2022–2023 breach saga remains a reputational drag. Some commentators warn that any new incident could hit the stock harder than it would for peers without similar history. [46]
- Macro and IT spending cycles
- Identity security is sticky, but large projects and expansions can still be delayed in a weaker macro environment.
- Several banks cited sector‑wide multiple compression and cautious IT spending as reasons to trim targets, even while acknowledging Okta’s execution. [47]
- Technical picture and trading dynamics
- Some AI‑driven technical services like TickerOn highlight bearish short‑term patterns (for example, Aroon‑indicator setups historically associated with further downside), underscoring the risk of continued volatility even if fundamentals remain steady. [48]
How does today’s setup frame Okta for different investor profiles?
Without telling you to buy, sell, or hold, we can outline how different types of investors might interpret the December 3 setup, based on current news and forecasts:
For growth‑at‑a‑reasonable‑price (GARP) investors
- Positives:
- Watch‑outs:
- Need to see whether cRPO growth and FY2027 commentary (when it eventually arrives) support a thesis of sustained mid‑teens growth rather than a slide into high single digits. [51]
For more defensive or income‑oriented investors
- Okta does not pay a dividend and still carries above‑average volatility, even with its improving fundamentals. [52]
- For investors seeking stable income or low volatility, this may still feel more like a smart‑beta “growth with quality” satellite than a core holding.
For short‑term traders
- The combination of:
- A new 52‑week low,
- A same‑day high‑single‑digit bounce, and
- Heavy news flow and target changes,
means liquidity and volatility are high—attractive for traders comfortable with large swings, but risky for those who aren’t. [53]
Bottom line
As of December 3, 2025, Okta is a study in contrasts:
- Financially, it just delivered a clean beat, raised guidance, and showcased a business that’s firmly profitable with enviable cash margins. [54]
- Narratively, it is still working through a history of security incidents, investor fatigue after a massive multi‑year drawdown, and questions about how fast it can grow in a more mature phase. [55]
- On the Street, analysts are shaving price targets but not fleeing: consensus forecasts cluster in the low‑to‑mid $110s, well above today’s mid‑$80s share price, even as a more vocal minority argues that better risk‑reward exists elsewhere in cybersecurity. [56]
For investors, Okta today looks less like a speculative high‑flyer and more like a profitable, strategically important platform whose stock is trying to find the right price for an 11–12% growth trajectory in an AI‑obsessed world.
If you’re considering any move in OKTA—entry, exit, or simply sizing—make sure you:
- Re‑read the latest earnings release and transcript
- Compare Okta’s growth and margins against your other cybersecurity holdings
- Factor in your own risk tolerance for volatility and security‑incident headlines
And, as always, consult a qualified financial professional before making investment decisions.
References
1. investor.okta.com, 2. investor.okta.com, 3. www.tikr.com, 4. stockanalysis.com, 5. stockanalysis.com, 6. www.reuters.com, 7. stockanalysis.com, 8. stockanalysis.com, 9. stockanalysis.com, 10. www.tradingview.com, 11. www.alphaspread.com, 12. investor.okta.com, 13. www.techbuzz.ai, 14. investor.okta.com, 15. www.reuters.com, 16. www.tikr.com, 17. www.tikr.com, 18. investor.okta.com, 19. coincentral.com, 20. www.marketwatch.com, 21. www.reuters.com, 22. investor.okta.com, 23. www.computerweekly.com, 24. stockanalysis.com, 25. www.marketbeat.com, 26. www.gurufocus.com, 27. www.investing.com, 28. www.gurufocus.com, 29. www.gurufocus.com, 30. coincentral.com, 31. www.investing.com, 32. www.marketbeat.com, 33. www.tikr.com, 34. www.alphaspread.com, 35. seekingalpha.com, 36. www.marketbeat.com, 37. finance.yahoo.com, 38. www.okta.com, 39. www.bankinfosecurity.com, 40. sec.okta.com, 41. www.computerweekly.com, 42. investor.okta.com, 43. www.marketbeat.com, 44. investor.okta.com, 45. seekingalpha.com, 46. onerep.com, 47. www.investing.com, 48. tickeron.com, 49. investor.okta.com, 50. www.reuters.com, 51. investor.okta.com, 52. stockanalysis.com, 53. stockanalysis.com, 54. investor.okta.com, 55. onerep.com, 56. stockanalysis.com
