TLDR
- BMO shifted Okta (OKTA) to Outperform from Market Perform, increasing its price target to $97
- Bernstein boosted its price target to $134 from $129 while keeping its Outperform rating
- Fourth quarter FY2026 subscription revenue climbed 11.5% year-over-year, exceeding guidance by $12 million
- Platform bookings represented 30% of Q4 total, a significant jump from the 10–15% range in prior quarters
- Several other Wall Street firms adjusted their price targets, spanning from $80 to $134
Friday brought significant activity for Okta as analyst upgrades and revised price targets emerged before the opening bell, pushing shares modestly higher in morning trade.
BMO’s Keith Bachman elevated Okta to Outperform from Market Perform while lifting his price target to $97. Bachman emphasized that identity management plays a crucial role in the expanding adoption of AI agents.
“We believe identity management is critical for agent adoption, and we think Okta will be one of the companies that nurtures, and benefits from, agent growth,” Bachman wrote.
Bachman further highlighted that Okta’s Identity Governance offering has substantial growth potential ahead. BMO’s analysis suggests the company has a solid probability of achieving flat to slightly improved subscription revenue growth in FY27 versus FY26.
Meanwhile, Bernstein increased its price target on Okta to $134 from $129 while maintaining its Outperform rating. The firm cited the company’s Q4 FY2026 performance as the catalyst.
Subscription revenue at Okta expanded 11.5% year-over-year during Q4, accelerating from 11.2% growth in the previous quarter. The company surpassed the midpoint of its internal forecast by $12 million.
What Drove the Q4 Beat
Bernstein identified three key factors behind the robust performance. First, accelerating momentum in net new customer additions combined with minimal churn. Second, sustained demand across Okta’s broader platform offerings. Third, the company moving past headwinds from oversized three-year deals executed during the COVID era.
One metric particularly caught attention. Platform bookings accounted for 30% of total Q4 bookings, significantly up from the 10–15% range seen in previous quarters. This shift is meaningful as it indicates customers are expanding their purchases beyond Okta’s core products to embrace more of its comprehensive suite.
Bernstein also highlighted that these solid results materialized despite challenges from U.S. federal government downsizing related to DOGE initiatives. This factor potentially reduced Okta’s annual recurring revenue by approximately $30 million in Q3.
Okta currently reports a gross profit margin of 77%, and its PEG ratio stands at 0.03, which InvestingPro characterizes as undervalued.
Where Other Analysts Stand
Not every Wall Street response to Okta’s latest performance matched the enthusiasm.
D.A. Davidson maintained a Buy rating alongside a $110 price target. Needham retained its Buy rating while reducing its target to $90, pointing to management’s conservative outlook. Stephens decreased its target to $95 but preserved an Overweight rating.
Scotiabank reduced its target to $80 while keeping a Sector Perform rating. Wolfe Research trimmed its target to $90 but sustained an Outperform rating.
For fiscal 2027, Okta provided guidance projecting approximately 10% subscription revenue growth year-over-year, marginally above analyst consensus but still considered cautious by some market observers.
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