Barclays Raises Okta Price Target to $112, Cites Strong RPO Growth

Okta's Q2 FY26 results met Barclays' expectations, with a 14% YoY RPO growth and 13% YoY revenue growth. The firm raised its price target from $100 to $112, citing strong RPO growth and improved net margins. The stock trades at a reasonable forward P/E of 24.89x and has an implied upside of 25.13%.

Title: Okta's Q2 FY26 Results Meet Barclays' Expectations

Okta, Inc. (NASDAQ: OKTA) reported its Q2 Fiscal Year 2026 results, which met Barclays' expectations. The company saw a 14% year-over-year (YoY) growth in its "clean" remaining performance obligation (RPO) and a 13% YoY increase in revenue. Barclays, in response, raised its price target for Okta from $100 to $112, citing strong RPO growth and improved net margins.

Okta's Q2 RPO growth of 14% YoY reached $4.15 billion, aligning with Barclays' projections. The company's revenue grew to $728 million, an increase of 13% YoY, driven by robust demand for its unified identity platform, particularly from the public sector. Additionally, the company reported an earnings per share (EPS) of $0.91, representing a 7.5% earnings surprise. Net margins have shown significant improvements over the last two quarters, reaching 9.2% in Q2, compared to 9.01% in Q1 and 1.07% in Fiscal Year 2025.

Barclays' analyst maintained an Equal Weight rating on Okta and noted that the company's increased fiscal year revenue guidance outlook of 11% growth removes "conservatism" from their analysis. The stock currently trades at a reasonable forward price-to-earnings (P/E) ratio of 24.89x, with an implied upside of 25.13% based on the current stock price of $89.5 and the new price target of $112.

While Okta's performance is commendable, Barclays suggests that certain AI stocks may offer greater upside potential and carry less downside risk. Investors are encouraged to stay informed about the evolving regulatory landscape and the resilience of supply chains as the market continues to shift.

References:
[1] https://www.bloomberg.com/news/articles/2025-09-04/ai-boom-can-deliver-100-billion-plus-deal-says-barclays-banker-woeber
[2] https://ca.finance.yahoo.com/news/barclays-raises-okta-okta-target-165549508.html
[3] https://finviz.com/news/158165/barclays-raises-okta-okta-target-cites-strong-rpo