Okta Stock Is Still Too Expensive
Okta (NASDAQ: OKTA) did it again. Its fiscal 2020 fourth-quarter earnings results (12 months ended Jan. 31, 2020) came in higher than what was forecast just a few months ago. Though the stock has been beaten up along with nearly everything else during the novel coronavirus outbreak and oil industry-fueled stock market rout, the high growth stock has fared far better than average. Shares are flat so far in 2020 compared with a 16.1% year-to-date loss for the S&P 500.
That surely makes Okta a buy then, right? Personally, I'm still on hold. Even with shares pulling back from all-time highs and business growing at a torrid pace, Okta still trades for a hefty premium.
Okta and its cloud-based identity security software continued to grow at a rapid pace last year. CEO Todd McKinnon said that three primary factors are contributing to Okta's success: Continued growth of cloud-based computing, organizations using the cloud to make digital transformation, and a heightened digital security risk that results from the transition. As to the last point, McKinnon said 70% of data breaches are due to compromised login credentials, so there has been plenty of demand for Okta's service.
Source Fool.com
