Okta (OKTA) Registers a Bigger Fall Than the Market: Important Facts to Note

Okta (OKTA) closed the latest trading day at $88.86, indicating a -0.65% change from the previous session's end. This change lagged the S&P 500's daily loss of 0.48%. Elsewhere, the Dow lost 0.37%, while the tech-heavy Nasdaq lost 0.82%.

The cloud identity management company's shares have seen an increase of 10.12% over the last month, surpassing the Computer and Technology sector's gain of 8.1% and the S&P 500's gain of 5.3%.

Analysts and investors alike will be keeping a close eye on the performance of Okta in its upcoming earnings disclosure. The company's earnings report is set to go public on February 28, 2024. The company is expected to report EPS of $0.51, up 70% from the prior-year quarter. Alongside, our most recent consensus estimate is anticipating revenue of $586.25 million, indicating a 14.95% upward movement from the same quarter last year.

Investors should also note any recent changes to analyst estimates for Okta. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Okta is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, Okta is holding a Forward P/E ratio of 45.42. This indicates a premium in contrast to its industry's Forward P/E of 18.49.

Investors should also note that OKTA has a PEG ratio of 1.18 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Internet - Software and Services industry stood at 1.03 at the close of the market yesterday.

The Internet - Software and Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 47, putting it in the top 19% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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