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Unpacking Q3 Earning: Okta (NASDAQ:OKTA) In The Context Of Other Cybersecurity Stocks


Adam Hejl /
2022/01/14 5:23 am EST
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Earnings results often give us a good indication what direction will the company will take in the months ahead. With Q3 now behind us, let’s have a look at Okta (NASDAQ:OKTA) and its peers.

Cybersecurity continues to be one of the fastest growing segments within software for good reason. Almost every company is slowly finding itself becoming a technology company and facing rising cybersecurity risks. Businesses are accelerating adoption of cloud based software, moving data and applications into the cloud to save costs while improving performance. This migration has opened them to a multitude of new threats, like employees accessing data via their smartphone while on an open network, or logging into a web-based interface from a laptop in a new location.

The 11 cybersecurity stocks we track reported a strong Q3; on average, revenues beat analyst consensus estimates by 6.26%, while on average next quarter revenue guidance was 2.62% above consensus. The technology sell-off has been putting pressure on stocks since November and while some of the cybersecurity stocks have fared somewhat better, they have not been spared, with share price declining 12.7% since earnings, on average.

Okta (NASDAQ:OKTA)

Founded during the aftermath of the financial crisis in 2009, Okta (NASDAQ:OKTA) is a cloud-based software as a service platform that helps companies manage identity for their employees and customers.

Okta reported revenues of $350.6 million, up 61.3% year on year, beating analyst expectations by 7.08%. It was a very strong quarter for the company, with an exceptional revenue growth and a solid beat of analyst estimates.

"Our strong third quarter results reflect the continued shift to Identity-First architectures and the critical adoption of Zero Trust security environments, which are both propelling our market leading position," said Todd McKinnon, Chief Executive Officer and co-founder of Okta.

Okta Total Revenue

The stock is up 1.77% since the results and currently trades at $201.49.

We think Okta is a good business, but is it a buy today? Read our full report here, it's free.

Best Q3: SentinelOne (NYSE:S)

With roots in the Israeli cyber intelligence community, SentinelOne (NYSE:S) provides software to help organizations efficiently detect, prevent, and investigate cyber attacks.

SentinelOne reported revenues of $56 million, up 128% year on year, beating analyst expectations by 12.9%. It was a stunning quarter for the company, with a significant improvement in gross margin and an impressive beat of analyst estimates.

SentinelOne Total Revenue

SentinelOne delivered the fastest revenue growth and highest full year guidance raise among its peers. The company added 71 enterprise customers paying more than $100,000 annually to a total of 416. The stock is down 11.4% since the results and currently trades at $45.30.

Is now the time to buy SentinelOne? Access our full analysis of the earnings results here, it's free.

Slowest Q3: SailPoint (NYSE:SAIL)

Started by Mark McClain after his previous identity management company got acquired by Sun Microsystems, SailPoint (NYSE:SAIL) provides software for organizations to manage the digital identity of employees, customers, and partners.

SailPoint reported revenues of $110.1 million, up 17.1% year on year, beating analyst expectations by 5.98%. It was a weaker quarter for the company, with an underwhelming revenue guidance for the next quarter and a decline in gross margin.

The stock is down 8.65% since the results and currently trades at $44.01.

Read our full analysis of SailPoint's results here.

Tenable (NASDAQ:TENB)

Founded in 2002 by three cybersecurity veterans, Tenable (NASDAQ:TENB) provides software as a service that helps companies understand where they are exposed to cyber security risk and how to reduce it.

Tenable reported revenues of $138.6 million, up 23.4% year on year, beating analyst expectations by 3.01%. It was an OK decent quarter for the company, with a decent beat of analyst estimates.

The stock is down 2.58% since the results and currently trades at $50.40.

Read our full, actionable report on Tenable here, it's free.

Rapid7 (NASDAQ:RPD)

Founded in 2000 with the idea that network security comes before endpoint security, Rapid7 (NASDAQ:RPD) provides software as a service that helps companies understand where they are exposed to cyber security risks, quickly detect breaches and respond to them.

Rapid7 reported revenues of $139.8 million, up 33.1% year on year, beating analyst expectations by 4.28%. It was a strong quarter for the company, with accelerating customer growth.

The company added 594 customers to a total of 9,909. The stock is down 24% since the results and currently trades at $97.56.

Read our full, actionable report on Rapid7 here, it's free.

The author has no position in any of the stocks mentioned