Okta (OKTA) Q3 results beat expectations across all metrics but it needs reacceleration next fiscal year as a catalyst, Morgan Stanley said in a Wednesday note.
The report said its results, including current remaining performance obligations growth and operating margins, and fiscal 2026 guide were in-line with buyside expectations.
However, Morgan Stanley said that without a fiscal 2027 guidance provided at the earnings call, it does not yet see a catalyst changing the sentiment on the company.
"We walk away encouraged, but catalyst remains reacceleration," the report said. "However, the company avoided guiding to FY27 on the FQ3 call, which pushes it out for at least a quarter."
The note also pointed to encouraging momentum on the go-to-market front and strong new product momentum.
"Despite the lack of near term catalyst, we would be buyers of
weakness on the print as we still believe we could see that reacceleration next fiscal year," the report said.
Morgan Stanley lowered its price target to $110 from $123 while keeping its overweight rating.
Price: 84.93, Change: +3.06, Percent Change: +3.74
Comments