Okta Inc. (OKTA)

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Okta, Inc. (OKTA) 'brand has been significantly degraded' - JMP Securities
By: Investing | November 27, 2023

JMP Securities downgraded shares of Okta, Inc. (NASDAQ:OKTA) to Market Perform from Under Review in a note Monday.

The firm, which does not have a price target on the stock, told investors that the recent security breach will lead to brand degradation and long-term customer expansion risk.

In late October, OKTA disclosed that an unidentified hacking group had accessed client files through a support system. OKTA shares tumbled following the news.

Analysts at JMP said that after examining the incident, evaluating Okta's response, and conducting their own due diligence with customers and industry experts, they believe "the brand has been significantly degraded, and customers are reconsidering their long-term strategic relationships with Okta."

"This represents a material change to our original investment thesis, which yields significant caution on our part, and we believe the path to further upside in the stock is limited, and we see the current risk/reward as balanced," the firm wrote.

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