Is Okta, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Okta, Inc. has moved from very attractive to fair. The company appears to be overvalued based on its current metrics, particularly with a P/E ratio of 147, which is significantly higher than the peer average of 98.52 for companies like PTC, Inc. (P/E of 49.59) and Zoom Video Communications, Inc. (P/E of 21.43). Additionally, Okta's EV to EBITDA stands at 145.00, compared to the peer average of 81.04, indicating a premium valuation relative to its peers.
The PEG ratio of 1.05 suggests that the stock is priced for growth, but the low ROCE of 0.49% and ROE of 1.90% raise concerns about the efficiency of capital utilization. Recent stock performance shows that Okta has underperformed the S&P 500 over the past week and month, with returns of -2.15% and -2.86%, respectively, while it has outperformed the index year-to-date and over the past year, with returns of 10.95% and 17.43%. Overall, these factors suggest that Okta, Inc. is currently overvalued.