Jim Cramer Praises Okta's Q2 Earnings Call

Okta, Inc. (OKTA) shares are up 16.7% YTD after a 16% drop in May. CEO Todd McKinnon's recent earnings call was praised by Jim Cramer as "terrific." The company beat analyst estimates in Q2 earnings. Cramer previously discussed the stock, but our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk.

Okta, Inc. (OKTA) shares have seen a significant turnaround in 2025, with a 16.7% year-to-date (YTD) increase following a 16% drop in May. The company's stock performance has been driven by strong earnings reports and a shift in analyst sentiment. CEO Todd McKinnon's recent earnings call was praised by Jim Cramer as "terrific," highlighting the company's resilience and potential for future growth.

In the second quarter of 2025, Okta reported earnings per share (EPS) of $0.86, exceeding analyst estimates by $0.09. The company's revenue for the quarter was $688 million, a 11.5% year-over-year increase. Okta also raised its full-year fiscal 2026 revenue guidance to $2.875-$2.885 billion and adjusted earnings outlook to $3.33-$3.38 per share [2].

Okta's stock has received a consensus rating of "Moderate Buy" from 37 analysts, with a projected average price target of $118.75 for the next 12 months [1]. This rating reflects a mix of buy, hold, and sell recommendations, with 22 analysts issuing buy ratings and 12 analysts giving hold recommendations. Three analysts have rated the stock as a sell. The average 12-month price objective among brokers that have covered the stock in the last year is $118.75.

Several analysts have recently changed their ratings on Okta. Wall Street Zen raised the stock from a "hold" rating to a "buy" rating, while BMO Capital Markets set a $132.00 price target and gave the stock a "market perform" rating. UBS Group dropped their price target from $150.00 to $130.00 and set a "buy" rating on the stock. Arete Research raised the stock to a "strong sell" rating and set a $83.00 price target. The Goldman Sachs Group upped their price target from $123.00 to $137.00 and gave the stock a "buy" rating [1].

Okta's stock performance has been supported by strong earnings and a shift in analyst sentiment. The company's resilience in navigating a shifting cybersecurity landscape and its ability to maintain a high net retention rate of 106% indicate that it is well-positioned for future growth. However, investors should be aware of the potential competitive pressure from Palo Alto Networks' acquisition of CyberArk, which could impact Okta's core business [2].

References:
[1] https://www.marketbeat.com/instant-alerts/okta-inc-nasdaqokta-given-consensus-recommendation-of-moderate-buy-by-brokerages-2025-08-27/
[2] https://www.techbuzz.ai/articles/okta-beats-q2-forecast-as-ceo-calls-economy-better-than-expected