Buy signal on Okta (OKTA-US)
Okta is a $ 39.9 Bn market cap and develops corporate identity management software. The company operates a platform (Okta Identity Cloud) that enables authentication and data security for IT organizations and web developers. 85% of net sales is generated in the United States.
Okta is trying to become a dominant player in Access Governance and is expected to launch new products that address Privileged Access Management (PAM) in 2022. Okta's single sign-on solutions and its identity cloud for both workforces and customers continue to be adopted and deployed rapidly by customers. Okta's compelling technology, deep moat, and ability to execute on its roadmap could enable the company to post robust growth for many years to come. Okta looks in position to exceed its goal of reaching $4 billion in revenue by FY2026 or grow by 35% CAGR.
Okta reported a solid Q2-21 and provided guidance that was ahead of estimates. Revenue was $315.5 million, up 57.4%, ahead of the consensus estimate of $296.5 million. Subscription revenue was $303.1 million and was up 59%. Okta's standalone revenue was $278 million and was up 39% Y/Y.
Okta guided Q3-21 revenue in the range of $325-327 million or 50% growth at the midpoint, versus a prior consensus of about $323 million. Loss per share is expected to be in the range of -$0.25 to -0.24, versus the previous consensus of -$0.50. For the full year, total revenue is expected to be in the range of $1,243-1,250 million or a growth of 49-to-50% Y/Y. The consensus revenue estimate was $1,223 million. Loss per share is expected to be in the range of -$0.77 to -0.74, versus prior consensus of -$1.11.
Short term catalyst : Accelerating growth, FY21 guidances raised.
This signal looks consistent with the US Software sector in Major Bullish Trend.