Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin5.2%
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin8.1%
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Financial Health
A
Years to Pay Off Debt1.8 yrs
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital$1.1B
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Valuation
F
Margin of Safety0.0%
How far below the Graham Number the stock trades. Graham required a 33% discount as a buffer against analytical error. However, the Graham Number itself assumes 1960s-era P/E and P/B norms — for modern asset-light businesses it often understates true intrinsic value, making 0% MoS appear misleadingly bad.
Price-to-Book2.80x
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies like software and consumer brands.
Cash Flow
A
Free Cash Flow$863M
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income8.9%
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings$352M
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
About Okta, Inc.
Okta, Inc. operates as an identity partner in the United States and internationally. It offers Single Sign-on to secure access to cloud and on-premises applications from any device; Adaptive MFA for a risk-based layer of security for an organization's cloud, mobile, and web applications; API Access Management, which enables organizations to secure APIs as systems; Access Gateway, which extends the Okta platform to hybrid IT environments; Okta Device Access, which extends Okta platform's secure access management to the device login experience; Universal Directory for a cloud-based system of record. The company also provides Identity Threat Protection; Identity Security Posture Management for security measures and safeguards digital assets; Okta for AI Agents to discover, register, authenticate, govern, and manage AI Agents; Identity Governance and Administration products, including Lifecycle Management, Okta Workflows, Okta Identity Governance, and Cross App Access; Advanced Server Access for continuous and contextual access management to secure cloud infrastructure; and Okta Privileged Access to reduce risk with unified access and governance management. In addition, it provides Universal Login, a standards-based login infrastructure; Attack Protection Suite to minimize risks associated with identity-targeted attacks; Adaptive MFA; Passwordless, which enables users to login without a password; Machine-to-Machine Tokens for authentication and authorization with NHIs; Private Cloud, a deployment option; Organizations, which support a large number of partners or customers; Extensibility, which enables customers to build customized identity flows; Fine Grained Authorization, which manages complex authorization scenarios; and Auth0 for AI Agents to secure and scale agentic applications. The company was formerly known as Saasure, Inc. Okta, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.
Okta, Inc. operates as an identity partner in the United States and internationally. It offers Single Sign-on to secure access to cloud and on-premises applications from any device; Adaptive MFA for a risk-based layer of security for an organization's cloud, mobile, and web applications; API Access Management, which enables organizations to secure APIs as systems; Access Gateway, which extends the Okta platform to hybrid IT environments; Okta Device Access, which extends Okta platform's secure access management to the device login experience; Universal Directory for a cloud-based system of record. The company also provides Identity Threat Protection; Identity Security Posture Management for security measures and safeguards digital assets; Okta for AI Agents to discover, register, authenticate, govern, and manage AI Agents; Identity Governance and Administration products, including Lifecycle Management, Okta Workflows, Okta Identity Governance, and Cross App Access; Advanced Server Access for continuous and contextual access management to secure cloud infrastructure; and Okta Privileged Access to reduce risk with unified access and governance management. In addition, it provides Universal Login, a standards-based login infrastructure; Attack Protection Suite to minimize risks associated with identity-targeted attacks; Adaptive MFA; Passwordless, which enables users to login without a password; Machine-to-Machine Tokens for authentication and authorization with NHIs; Private Cloud, a deployment option; Organizations, which support a large number of partners or customers; Extensibility, which enables customers to build customized identity flows; Fine Grained Authorization, which manages complex authorization scenarios; and Auth0 for AI Agents to secure and scale agentic applications. The company was formerly known as Saasure, Inc. Okta, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.
Metric Explanations
What each dimension measures and where the thresholds come from.
Gross Profit Margin
Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Years to Pay Off Debt
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Margin of Safety
How far below the Graham Number the stock trades. Graham required a 33% discount as a buffer against analytical error. However, the Graham Number itself assumes 1960s-era P/E and P/B norms — for modern asset-light businesses it often understates true intrinsic value, making 0% MoS appear misleadingly bad.
Price-to-Book
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies like software and consumer brands.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Mr. Market is currently offering Okta, Inc. at $117.81.
The business passes only 2 of 7 of Graham's defensive criteria — well below his required standard.
At $117.81, the stock trades at a 234% premium to its Graham Number of $35.24. Graham would consider this price speculative.
There is no margin of safety at the current price. Graham would advise patience and waiting for a better entry point.
Trading at 21.0x NCAV. Expected for most quality businesses — NCAV was designed to find depression-era bargains and rarely applies to modern profitable companies..
Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.
Showing Key Metrics
Income Highlights
Metric
2026
2025
2024
2023
2022
Gross Profit %
77.4%▲
76.3%▲
74.3%▲
70.6%•
N/A
Operating Margin %
5.2%▲
-2.4%▲
-20.3%▲
-42.1%•
N/A
Net Income %
8.1%▲
1.1%▲
-15.7%▲
-43.9%•
N/A
Diluted EPS
1.31▲
0.06▲
-2.17▲
-5.16•
N/A
Balance Sheet Highlights
Metric
2026
2025
2024
2023
2022
Total Assets
$9.7B
$9.4B
$9.0B
$9.3B
N/A
Total Debt
$422M▼
$952M▼
$1.3B▼
$2.4B•
N/A
Working Capital
$1.1B▲
$893M▼
$1.2B▼
$1.8B•
N/A
Years to Pay Debt
1.80
34.00
-3.57
-2.90
N/A
Cash Flow Highlights
Metric
2026
2025
2024
2023
2022
Free Cash Flow
$863M▲
$730M▲
$488M▲
$63M•
N/A
Owner Earnings
$352M
$146M
-$232M
-$678M
N/A
CapEx % of Net Income
8.9%
71.4%
N/A
N/A
N/A
Income Statement
2026
2025
2024
2023
2022
Tax Effect Of Unusual Items
-316
3,120
10,500
-6,090
Tax Rate For Calcs
0
0
0
0
Normalized EBITDA
359,000
141,000
-280,000
-647,000
Total Unusual Items
-4,000
8,000
50,000
-29,000
Total Unusual Items Excluding Goodwill
-4,000
8,000
50,000
-29,000
Net Income From Continuing Operation Net Minority Interest
235,000
28,000
-355,000
-815,000
Reconciled Depreciation
96,000
98,000
99,000
114,000
Reconciled Cost Of Revenue
661,000
618,000
581,000
546,000
EBITDA
355,000
149,000
-230,000
-676,000
EBIT
259,000
51,000
-329,000
-790,000
Net Interest Income
106,000
101,000
73,000
11,000
Interest Expense
4,000
5,000
8,000
11,000
Interest Income
110,000
106,000
81,000
22,000
Normalized Income
238,684
23,120
-394,500
-792,090
Net Income From Continuing And Discontinued Operation
235,000
28,000
-355,000
-815,000
Total Expenses
2,766,000
2,673,000
2,723,000
2,641,000
Total Operating Income As Reported
149,000
-74,000
-516,000
-812,000
Diluted Average Shares
179,290
175,086
163,634
158,023
Basic Average Shares
175,882
169,569
163,634
158,023
Diluted EPS
0
0
0
0
Basic EPS
0
0
0
0
Diluted NI Availto Com Stockholders
235,000
28,000
-355,000
-815,000
Net Income Common Stockholders
235,000
28,000
-355,000
-815,000
Net Income
235,000
28,000
-355,000
-815,000
Net Income Including Noncontrolling Interests
235,000
28,000
-355,000
-815,000
Net Income Continuous Operations
235,000
28,000
-355,000
-815,000
Tax Provision
20,000
18,000
18,000
14,000
Pretax Income
255,000
46,000
-337,000
-801,000
Other Income Expense
-4,000
8,000
50,000
-29,000
Special Income Charges
-4,000
8,000
50,000
-29,000
Other Special Charges
-19,000
-106,000
179
Impairment Of Capital Assets
28,000
14,000
Restructuring And Mergern Acquisition
4,000
11,000
56,000
29,000
Net Non Operating Interest Income Expense
106,000
101,000
73,000
11,000
Interest Expense Non Operating
4,000
5,000
8,000
11,000
Interest Income Non Operating
110,000
106,000
81,000
22,000
Operating Income
153,000
-63,000
-460,000
-783,000
Operating Expense
2,105,000
2,055,000
2,142,000
2,095,000
Research And Development
639,000
642,000
656,000
620,000
Selling General And Administration
1,466,000
1,413,000
1,486,000
1,475,000
Selling And Marketing Expense
1,018,000
965,000
1,036,000
1,066,000
General And Administrative Expense
448,000
448,000
450,000
409,000
Other Gand A
448,000
448,000
450,000
409,000
Gross Profit
2,258,000
1,992,000
1,682,000
1,312,000
Cost Of Revenue
661,000
618,000
581,000
546,000
Total Revenue
2,919,000
2,610,000
2,263,000
1,858,000
Operating Revenue
2,919,000
2,610,000
2,263,000
1,858,000
Balance Sheet
2026
2025
2024
2023
2022
Ordinary Shares Number
177,357
173,459
167,126
161,309
Share Issued
177,357
173,459
167,126
161,309
Net Debt
449,000
820,000
1,929,000
1,572,000
Total Debt
422,000
952,000
1,266,000
2,367,000
Tangible Book Value
1,421,000
819,000
300,000
-175,000
Invested Capital
7,349,000
7,263,000
7,042,000
7,659,000
Working Capital
1,090,000
893,000
1,198,000
1,764,000
Net Tangible Assets
1,421,000
819,000
300,000
-175,000
Capital Lease Obligations
72,000
94,000
112,000
174,000
Common Stock Equity
6,999,000
6,405,000
5,888,000
5,466,000
Total Capitalization
6,999,000
6,754,000
7,042,000
7,659,000
Total Equity Gross Minority Interest
6,999,000
6,405,000
5,888,000
5,466,000
Stockholders Equity
6,999,000
6,405,000
5,888,000
5,466,000
Gains Losses Not Affecting Retained Earnings
13,000
-12,000
-6,000
-33,000
Other Equity Adjustments
13,000
-12,000
-6,000
-33,000
Retained Earnings
-2,567,000
-2,802,000
-2,830,000
-2,475,000
Additional Paid In Capital
9,553,000
9,219,000
8,724,000
7,974,000
Total Liabilities Net Minority Interest
2,711,000
3,032,000
3,101,000
3,841,000
Total Non Current Liabilities Net Minority Interest
157,000
509,000
1,319,000
2,376,000
Other Non Current Liabilities
55,000
39,000
30,000
11,000
Non Current Deferred Liabilities
30,000
27,000
23,000
30,000
Non Current Deferred Revenue
30,000
27,000
23,000
18,000
Non Current Deferred Taxes Liabilities
16,000
12,000
9,000
Long Term Debt And Capital Lease Obligation
72,000
443,000
1,266,000
2,335,000
Long Term Capital Lease Obligation
72,000
94,000
112,000
142,000
Long Term Debt
349,000
1,154,000
2,193,000
1,816,000
Current Liabilities
2,554,000
2,523,000
1,782,000
1,465,000
Other Current Liabilities
8,000
8,000
8,000
Current Deferred Liabilities
1,875,000
1,691,000
1,488,000
1,242,000
Current Deferred Revenue
1,875,000
1,691,000
1,488,000
1,242,000
Current Debt And Capital Lease Obligation
350,000
509,000
31,000
32,000
Current Capital Lease Obligation
31,000
32,000
27,000
Current Debt
350,000
509,000
16,000
Other Current Borrowings
350,000
509,000
16,000
Pensionand Other Post Retirement Benefit Plans Current
213,000
207,000
167,000
99,000
Payables And Accrued Expenses
116,000
116,000
127,000
84,000
Current Accrued Expenses
104,000
103,000
115,000
67,000
Payables
12,000
13,000
12,000
17,000
Total Tax Payable
4,000
5,000
7,000
Accounts Payable
12,000
13,000
12,000
12,000
Total Assets
9,710,000
9,437,000
8,989,000
9,307,000
Total Non Current Assets
6,066,000
6,021,000
6,009,000
6,078,000
Other Non Current Assets
53,000
51,000
48,000
46,000
Non Current Deferred Assets
332,000
267,000
242,000
210,000
Goodwill And Other Intangible Assets
5,578,000
5,586,000
5,588,000
5,641,000
Other Intangible Assets
91,000
138,000
182,000
241,000
Goodwill
5,487,000
5,448,000
5,406,000
5,400,000
Net PPE
103,000
117,000
131,000
181,000
Accumulated Depreciation
-70,000
-56,000
-62,000
-48,000
Gross PPE
173,000
173,000
193,000
229,000
Leases
90,000
84,000
92,000
88,000
Machinery Furniture Equipment
18,000
15,000
18,000
19,000
Buildings And Improvements
65,000
74,000
83,000
122,000
Current Assets
3,644,000
3,416,000
2,980,000
3,229,000
Other Current Assets
209,000
132,000
106,000
76,000
Current Deferred Assets
171,000
140,000
113,000
92,000
Prepaid Assets
66,605
Receivables
711,000
621,000
559,000
481,000
Accrued Interest Receivable
24,000
Accounts Receivable
687,000
621,000
559,000
481,000
Allowance For Doubtful Accounts Receivable
-4,000
-6,000
-8,000
-4,000
Gross Accounts Receivable
625,000
565,000
489,000
402,000
Cash Cash Equivalents And Short Term Investments
2,553,000
2,523,000
2,202,000
2,580,000
Other Short Term Investments
1,695,000
2,114,000
1,868,000
2,316,000
Cash And Cash Equivalents
858,000
409,000
334,000
264,000
Cash Equivalents
670,000
248,000
151,000
133,000
Cash Financial
188,000
161,000
183,000
131,000
Cash Flow
2026
2025
2024
2023
2022
Free Cash Flow
863,000
730,000
488,000
63,000
Repurchase Of Capital Stock
-73,000
0
0
Repayment Of Debt
-510,000
-280,000
-937,000
0
Capital Expenditure
-21,000
-20,000
-24,000
-23,000
Interest Paid Supplemental Data
3,000
5,000
6,000
6,000
Income Tax Paid Supplemental Data
19,000
14,000
8,000
3,000
End Cash Position
864,000
415,000
342,000
271,000
Beginning Cash Position
415,000
342,000
271,000
273,000
Effect Of Exchange Rate Changes
14,000
-4,000
1,000
-6,000
Changes In Cash
435,000
77,000
70,000
4,000
Financing Cash Flow
-720,000
-359,000
-883,000
48,000
Cash Flow From Continuing Financing Activities
-720,000
-359,000
-883,000
48,000
Net Other Financing Charges
-190,000
-148,000
-7,000
2
Proceeds From Stock Option Exercised
53,000
69,000
54,000
48,000
Net Common Stock Issuance
-73,000
0
0
Common Stock Payments
-73,000
0
0
Net Issuance Payments Of Debt
-510,000
-280,000
-937,000
0
Net Long Term Debt Issuance
-510,000
-280,000
-937,000
0
Long Term Debt Payments
-510,000
-280,000
-937,000
0
Investing Cash Flow
271,000
-314,000
441,000
-130,000
Cash Flow From Continuing Investing Activities
271,000
-314,000
441,000
-130,000
Net Investment Purchase And Sale
348,000
-238,000
487,000
-103,000
Sale Of Investment
1,853,000
1,574,000
2,196,000
1,308,000
Purchase Of Investment
-1,505,000
-1,812,000
-1,709,000
-1,411,000
Net Business Purchase And Sale
-56,000
-56,000
-22,000
-4,000
Purchase Of Business
-56,000
-56,000
-22,000
-4,000
Net Intangibles Purchase And Sale
0
0
-1,000
-2,000
Purchase Of Intangibles
0
0
-1,000
-2,000
Net PPE Purchase And Sale
-9,000
-8,000
-8,000
-12,000
Purchase Of PPE
-9,000
-8,000
-8,000
-12,000
Capital Expenditure Reported
-12,000
-12,000
-15,000
-9,000
Operating Cash Flow
884,000
750,000
512,000
86,000
Cash Flow From Continuing Operating Activities
884,000
750,000
512,000
86,000
Change In Working Capital
-173,000
-53,000
54,000
-7,000
Change In Other Working Capital
-58,000
21,000
92,000
142,000
Change In Other Current Liabilities
-30,000
-33,000
-39,000
-34,000
Change In Other Current Assets
18,000
20,000
23,000
27,000
Change In Payables And Accrued Expense
0
39,000
89,000
-42,000
Change In Accrued Expense
2,000
38,000
89,000
-36,000
Change In Payable
-2,000
1,000
-6,000
7,000
Change In Account Payable
-2,000
1,000
0
-6,000
Change In Prepaid Assets
-33,000
-37,000
-32,000
-13,000
Change In Receivables
-70,000
-63,000
-79,000
-87,000
Changes In Account Receivables
-70,000
-63,000
-79,000
-87,000
Other Non Cash Items
169,000
129,000
102,000
96,000
Stock Based Compensation
544,000
565,000
684,000
677,000
Asset Impairment Charge
0
0
28,000
14,000
Deferred Tax
13,000
2,000
6,000
7,000
Deferred Income Tax
13,000
2,000
6,000
7,000
Depreciation Amortization Depletion
96,000
98,000
99,000
114,000
Depreciation And Amortization
96,000
98,000
99,000
114,000
Amortization Cash Flow
83,000
85,000
Amortization Of Intangibles
83,000
85,000
Depreciation
13,000
12,000
84,000
114,000
Operating Gains Losses
-19,000
-106,000
-1,000
-8,000
Gain Loss On Investment Securities
-1,000
-8,000
Net Income From Continuing Operations
235,000
28,000
-355,000
-815,000
2/7
Graham Score
Speculative Investor
Fails most of Graham's safety criteria. Treat with caution.
Graham's Fair Value
$35.24
Margin of Safety
0%
Market Cap / Net Assets
2.8x
Net Assets: $7.0B
Warren's Owner Earnings
$352M
Latest fiscal year
Graham's 7 Criteria
Defensive Investor Checklist
2/7 — Speculative Investor
✅
Adequate Size
Graham required companies large enough to withstand economic downturns. This threshold ($1.5B) is inflation-adjusted from Graham's original $100M — virtually all S&P 500 companies pass this today.
$2.9B
vs > $1.5B revenue
❌
Strong Financial Condition
Current assets must be at least twice current liabilities. Note: highly profitable companies (Apple, Domino's) often run negative or low working capital deliberately — they collect cash fast and stretch payables. A failing score here is not always a warning sign.
1.43x
vs Current Ratio > 2.0x
❌
Earnings Stability
Graham required uninterrupted positive earnings. Any loss year is a red flag for defensive investors. Growth companies and cyclicals may show occasional losses during investment cycles or downturns without being fundamentally unsound.
2 loss years (4 yrs data)
vs No negative EPS years
❌
Dividend Record
Graham valued dividends as evidence of financial discipline and shareholder alignment. Many excellent modern businesses (Alphabet, Amazon, Berkshire Hathaway) pay no dividend, preferring to reinvest cash at high rates of return. Failing this criterion does not indicate a poor business — it may indicate a high-growth one.
No dividend
vs Uninterrupted dividends
✅
Earnings Growth
EPS grew from $0.06 to $1.31 over 1 years. Graham's 33% threshold was set over a 10-year period. Measured over fewer years (as here), the bar is proportionally lower. Share buybacks can also inflate EPS growth without reflecting underlying business improvement.
+2083.3% EPS growth
vs > 33% EPS growth
❌
Moderate P/E Ratio
Graham's 15x P/E threshold was calibrated to 1960s market averages when interest rates were higher. Today's lower rate environment structurally supports higher multiples — the S&P 500 long-run average P/E is now closer to 20–25x. A stock trading at 20x is not automatically speculative in the modern context.
85.4x
vs P/E ≤ 15.0x
❌
Moderate Price-to-Book
Graham's 1.5x P/B threshold made sense when most company value was tangible. Today, intangible assets — brand, software, patents, network effects — rarely appear on the balance sheet. A high P/B in tech, pharma, or consumer brands often reflects intangible value, not overvaluation. P/FCF or EV/EBITDA are more reliable for asset-light businesses.
2.80x P/B (P/E×P/B: 238.7)
vs P/B ≤ 1.5x | P/E × P/B ≤ 22.5
Graham's 7 Criteria — Explained
What each criterion measures and why it matters.
✅ Adequate Size — $2.9Bvs > $1.5B revenue
Graham required companies large enough to withstand economic downturns. This threshold ($1.5B) is inflation-adjusted from Graham's original $100M — virtually all S&P 500 companies pass this today.
"The minimum size of an enterprise should be not less than $100 million of annual sales."
❌ Strong Financial Condition — 1.43xvs Current Ratio > 2.0x
Current assets must be at least twice current liabilities. Note: highly profitable companies (Apple, Domino's) often run negative or low working capital deliberately — they collect cash fast and stretch payables. A failing score here is not always a warning sign.
"For industrial companies, current assets should be at least twice current liabilities."
❌ Earnings Stability — 2 loss years (4 yrs data)vs No negative EPS years
Graham required uninterrupted positive earnings. Any loss year is a red flag for defensive investors. Growth companies and cyclicals may show occasional losses during investment cycles or downturns without being fundamentally unsound.
"The company should have shown no deficit in the past ten years."
❌ Dividend Record — No dividendvs Uninterrupted dividends
Graham valued dividends as evidence of financial discipline and shareholder alignment. Many excellent modern businesses (Alphabet, Amazon, Berkshire Hathaway) pay no dividend, preferring to reinvest cash at high rates of return. Failing this criterion does not indicate a poor business — it may indicate a high-growth one.
"Some current dividend payments — for at least the past 20 years."
EPS grew from $0.06 to $1.31 over 1 years. Graham's 33% threshold was set over a 10-year period. Measured over fewer years (as here), the bar is proportionally lower. Share buybacks can also inflate EPS growth without reflecting underlying business improvement.
"A minimum increase of at least one-third in per-share earnings over ten years."
❌ Moderate P/E Ratio — 85.4xvs P/E ≤ 15.0x
Graham's 15x P/E threshold was calibrated to 1960s market averages when interest rates were higher. Today's lower rate environment structurally supports higher multiples — the S&P 500 long-run average P/E is now closer to 20–25x. A stock trading at 20x is not automatically speculative in the modern context.
"The price-earnings ratio should be no more than 15 times average earnings."
Graham's 1.5x P/B threshold made sense when most company value was tangible. Today, intangible assets — brand, software, patents, network effects — rarely appear on the balance sheet. A high P/B in tech, pharma, or consumer brands often reflects intangible value, not overvaluation. P/FCF or EV/EBITDA are more reliable for asset-light businesses.
"The price should not be more than 1½ times book value. P/E × P/B ≤ 22.5."
These metrics estimate what Okta, Inc. is worth based on fundamentals — independent of what the market prices it at.
Graham's Fair Value and NCAV are conservative floors.
EPV assumes zero growth. These are reference points, not price targets.
Net Current Asset Value
$5.62
Trading at 21.0x NCAV. Expected for most quality businesses — NCAV was designed to find depression-era bargains and rarely applies to modern profitable companies.
"Buy at two-thirds of net current assets." — Graham
Earnings Power Value
$10.23
Per share, no-growth floor. Compare to current price.
ROIC — Return on Invested Capital
1.7%
Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.
Cash Flow Analysis
Metric
2026
2025
2024
2023
2022
Capital Expenditure % of Net Income
8.9%
71.4%
N/A
N/A
N/A
Repurchase of Capital Stock
-$73M
$0M
$0M
N/A
N/A
Free Cash Flow
$863M▲
$730M▲
$488M▲
$63M•
N/A•
Warren's Owner Earnings
$352M
$146M
-$232M
-$678M
N/A
Peers & Industry
No auto-detected peers for Software - Infrastructure. You can manually compare OKTA against any stock using the Compare tool.
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
Capital Allocation & Alignment
Insider Ownership
0.62%
Low — management has little skin in the game
Return on Equity (ROE)
3.4%
Weak — poor returns on equity
Return on Assets (ROA)
2.4%
Fair — average asset utilization
Share Buybacks (Latest Year)
$73M
Management is returning capital to shareholders via buybacks
Debt Trend YoY
-55.7% YoY
Debt is declining — management is deleveraging
Leadership Team
Todd McKinnon
Co-Founder, Chairman & CEO
Age 53
Pay: $1,159,452
0.493% of net income
Jacques Frederic Kerrest
Co-Founder & Executive Vice Chairman
Age 47
Pay: $39,207
0.017% of net income
Eric Kelleher
President & COO
Age 53
Pay: $825,343
0.351% of net income
Brett Tighe
Chief Financial Officer
Age 44
Pay: $865,232
0.368% of net income
Dave Gennarelli
Senior Vice President of Investor Relations
Top Institutional Holders
Institution
% Owned
Shares
Blackrock Inc.
11.46%
19,037,532
FMR, LLC
6.83%
11,342,824
Vanguard Portfolio Management LLC
5.56%
9,231,099
Vanguard Capital Management LLC
4.57%
7,587,698
State Street Corporation
3.68%
6,109,776
First Trust Advisors LP
2.53%
4,194,608
Massachusetts Financial Services Co.
2.25%
3,737,304
Allspring Global Investments Holdings, LLC
2.14%
3,553,091
Risk Analysis
Beta (Market Risk)
0.79
Low volatility — more stable than the market
Short Interest
5.4% of float
Moderate short interest
Debt-to-Equity
0.06x
Conservative balance sheet — low financial risk
Current Ratio
1.43x
Adequate liquidity
52-Week Price Range
Low: $62.66Current: $117.81High: $142.35
Currently at 69% of 52-week range
Okta, Inc. (OKTA) fundamental analysis — Overall grade C based on profitability, financial health, valuation and cash flow. Graham's
Fair Value: $35.24. Margin of safety: 0%. Gross profit margin: 77.4%. Operating margin: 5.2%. Net margin: 8.1%. Market cap: $20.5B. Sector: Technology. Industry: Software - Infrastructure. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett
principles.
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