What happened
Shares of Okta (NASDAQ: OKTA) jumped 21% in March, according to data provided by S&P Global Market Intelligence. This rise in the stock's price means that shares of the identity management company have risen by 24% year to date.
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So what
Okta released its fourth-quarter and full-year results for 2022 early last month. It was an encouraging set of earnings that saw 2022's top line continue to rise, jumping 43% year over year to $1.86 billion.
Of this total, $1.79 billion comprised stable subscription revenue, which was up 44% year over year. Investors were probably also glad to see Okta's customer count continue to climb, up 17% year over year to 17,600. Of this group, 3,930 customers had annual contract values exceeding $100,000, a 27% improvement over the prior year's count of 3,100. Dollar-based net retention rate has also stayed above 120% for the past 12 consecutive quarters, attesting to Okta's sticky customer base.
The sentiment was also buoyed for growth stocks in general, as the Nasdaq Composite rose by 6.7% during the month, taking its year-to-date performance up to 17.7%. Okta also released an encouraging forecast for fiscal 2024, with revenue expected to continue growing by 16% to 17% year over year to between $2.15 billion and $2.17 billion. If the company achieves this forecast, revenue will have grown at a compound annual growth rate of 37% from fiscal 2021 through fiscal 2024, an impressive feat.
Now what
The outlook continues to be bright for Okta, as the company is still touting an $80 billion total addressable market for its services. This growth can be achieved steadily through platform innovation, international expansion, and its land-and-expand business development technique.
Okta scored a significant win when its security solution for federal agencies, Okta for Government High, received High Authorization that will allow the company to permeate its identity-based solutions through more federal departments. Its solution is impressive, as it is compliant with more than 420 baseline security controls for handling sensitive information, putting it ahead of competitors that may not possess this capability.
Meanwhile, Okta is working with technology and alliance partners in Asia to deliver customer identity and access management solutions and grow its integration network. Businesses that tap into its solutions can enjoy better overall user experience and enhanced security while providing personalized digital experiences.
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Royston Yang has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Okta. The Motley Fool has a disclosure policy.
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