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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Okta, Inc. (XNAS:OKTA) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
OKTA
Name:
OKTA, INC. (XNAS:OKTA)
Sector:
52.69M
Industry:
Software�Infrastructure
CEO:
Mr. Todd McKinnon
Total Employees:
5,776
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -27.52% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF OKTA, INC.(OKTA) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SOFTWARE�INFRASTRUCTURE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
64.63
One Month Price Target:
$65.03
Six Month Price Target :
$67.02
Likely Price in One Year's Time:
Ticker:
$69.42
Likely Trading Range Today Under (Normal Volatility)
$64.21
Price Upper limit ($) :
$65.03
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$59.66
This week:
$53.52
This month :
$42.41
Other Primary facts
Market Cap:
9.64B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
158.87M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
13.56%
-33.7%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$87.71
$77.24
$41.55
$52.02
Medium risk (<10%) entry points
Buy Call
Sell Call
$73.83
Buy Put:
Sell Put:
$71.60
$55.40
$57.66
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
OKTA
Sharpe Ratio:
-0.63%
Comparison:
OKTA, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -138.59% lower than the industry
& is -127.68% lower than the market/S&P 500 average
Average Returns/Yield of
OKTA
Daily returns:
-0.01%
Weekly returns:
-0.07%
Monthly returns:
-0.29%
Yearly returns:
14.38%
Comparison of returns:
Average annual returns/yield (last 3 years) is -124.57% below industry average
Classification:
OKTA, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.82
Statistical test of Returns:
OKTA has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.74%
Weekly Volatility:
8.35%
Monthly Volatility:
16.71%
Yearly Volatility:
57.88%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
18.46%
Volatility in last five trading days has been 394.10% above long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.69%
Weekly VaR:
-17.19%
Monthly VaR:
-34.38%
How Much Can the price of
OKTA
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-31%
Worst case (decline):
>85%
This translates to price declining to:
$44.86
This translates to price declining to:
$9.69
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
OKTA is a 142.68% riskier investment compared to the market/S&P 500 & is 107.90% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 12.14% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
OKTA
Beta in relation to market/S&P 500--1.10
Expected beta in 1 year's time:
1.166
Expected beta in 3 year's time:
1.648
Unlevered (debt free) Beta:
0.289
Beta in relation to Nasdaq (XNAS):
1.238
Beta in relation to all global stocks::
0.53
Beta Comparison & Analysis
Beta of competitors/peers::
1.476
Beta is -25.27% lower than peers
Average Industry Beta:
1.112
Beta is -0.80% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
-0.142
Alpha is -493.55% below industry average alpha yield
Alpha is -906% below the market average
Analysis of Cost of Capital of
OKTA
Equity cost of capital:
0.107
Equity cost of capital is -0.57% below industry mean WACC
Unlevered (without debt) cost of capital:
2.80%
Before-tax cost of debt:
3.72%
After-tax cost of debt:
2.94%
Overall debt rating:
Upper medium A grade (third highest grade),CO8<=0.0429,"Medium BBB grade (Fourth highest grade)
Weighted average cost of capital (WACC):
2.94%
WACC is -16.42% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$9.22
Revenue growth rate per share of (3Y):
15.04
Annual revenue growth rate is 50.39% above the industry average
EPS:
-$6.38
Expected Annual growth rate of EPS (3Y):
69.82%
Expected future EPS growth rate is 131.76% higher than the Software�Infrastructure industry
Free cash flow (FCF) per share:
$0.28
-
-
Debt per share
$12.12
EBITDA per share
-$4.94
Valuation Analysis Today of
OKTA
P/E Ratio:
-
P/E Ratio of Competitors/Peers:
98.09
-
-
OKTA is -115.53% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
7.01
Price to sales ratio is -36.15% below the industry mean
P/B (Price to book value ratio):
15.04
Price to free cash flow: 234.14
-
Net income growth rate (3Y):
51.96%
Net income growth rate is -99.39% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
281.91%
Net debt to equity ratio:
188.30%
Debt to assets ratio:
56.11%
Net debt to assets ratio:
37.48%
Debt-to-asset ratio is -19.53% below industry average
Ability to repay debt:
Interest coverage ratio:
-10.85
Interest coverage ratio is -94.86% less than industry average
Looking forward:
Debt growth rate:
109.98%
Annual debt growth is 2% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.453
Statistical significance of correlation:
OKTA has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.48
Stock price is -5.55% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.48
Correlation of price movement with Nasdaq (^IXIC):
-0.062
Covariance of price movement with the market:
-0.135
Kurtosis
9.935
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-1.124
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
OKTA
Gross Profit Margin Ratio:
274%
Operating Profit Margin Ratio:
-62.57%
Operating profit margin is 427.18% higher than the industry
Net Profit Margin Ratio:
274%
Effective Tax Rate:
-0.06%
Effective tax rate is -100.18% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-143.81%
Return on equity (ROE) is -234.71% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-28.62%
Return on assets (ROA) is 655.84% higher than the industry
Financial Leverage:
2.3x
Current Ratio:
3.76
Current ratio is 61.65% above industry average
Cash Conversion Cycle (days):
111.6
Cash conversion cycle is -0.88% below industry average
The remaining useful life of property plant & equipment is: 13.7 years
Stock based compensation to net income ratio:
-6.53%
In-depth Efficiency Analysis
Revenue generated per employee:
253.5K
Each employee generates -36% less revenue than industry average revenue per employee
EBITDA generated per employee:
- 135.8K
Each employee generates -308% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 170.0K
Each employee generates -912% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
9.1K
Each employee generates -54% less free cash flow than industry average revenue per employee
Assets/Capital per employee
72.4K
Each employee generates -54% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 39.91%
Growth rate in R&D investment/expenditure is -1638.93% lower than the industry
Competitors/Peer firms of
OKTA
APPLOVIN CORPORATION (XNAS:APP)
ANSYS, INC. (XNAS:ANSS)
GLOBALFOUNDRIES INC. (XNAS:GFS)
ZEBRA TECHNOLOGIES CORPORATION (XNAS:ZBRA)
ON SEMICONDUCTOR CORPORATION (XNAS:ON)
MXIM
CDW CORPORATION (XNAS:CDW)
DOCUSIGN, INC. (XNAS:DOCU)
VERISIGN, INC. (XNAS:VRSN)
Current Analyst Ratings
Strong buy�8%
Buy�13%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
1.46B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
461.45M
1.00B
562.05M
480.48M
1.36B
876.28M
-
1.92B
5.41M
72.29M
124.54M
- 784499.00K
- 916111.00K
- 981892.00K
- 981327.00K
565.00K
- 981892.00K
Statement of Cash Flow
Date:
Period:
13.13M
Differed Income Tax :
- 829.00K
Stock Based Compensation :
64.11M
Change in Working Capital :
57.39M
Accounts Receivables:
- 22747.00K
Other Working Capital:
72.62M
Other Non-Cash Items:
31.50M
Net Cash Provided by Operating Activities:
56.08M
Investments in PP&E:
- 3259.00K
Net Acquisitions:
-
Purchases of Investments:
- 189533.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
659.89M
2.03B
2.69B
218.47M
-
103.60M
3.01B
207.98M
48.02M
24.19M
-
-
138.12M
418.31M
-
3.43B
9.54M
20.78M
-
613.17M
156.97M
800.46M
1.92B
10.67M
1.95B
-
2.75B
14.00K
- 1076688.00K
5.6M
1.75B
April 30, 2021 at 6:00:00 AM
2.38B
682.78M
3.43B
-
1.95B
1.3B
344.82M
- 123.00K
151.91M
- 12.00K
-
-
-
16.19M
16.18M
647.00K
224.81M
673.44M
448.63M
56.08M
- 3382.00K
52.69M
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
OKTA
2023
2024
2025
2026
2027
$69.64
$74.80
$80.34
$86.30
$92.69