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Rising adoption of AI agents will boost demand for identity security product providers such as Okta , according to BMO Capital Markets. The bank upgraded the cloud stock to outperform from market perform. Analyst Keith Bachman also hiked his price target to $97 from $83, which signals upside of 22%. Shares of Okta have slipped 8% this year and are down 28% over the past 12 months. But the stock jumped 11% on Thursday , following its fourth-quarter earnings report Wednesday evening that exceeded Wall Street’s estimates. OKTA YTD mountain OKTA YTD chart Bachman cited increased confidence in revenue growth durability for his upgrade. He thinks Okta could generate flat to modestly higher subscription revenue growth year-over-year in 2027. Bachman said Okta could be a beneficiary or agentic artificial intelligence swelling in popularity as identity management becomes increasingly important to enterprise security. “We believe that identity and access management (IAM) and identity security will become key enablers of agent adoption over the next several years,” he wrote. “We believe that Okta, as an established and leading IAM provider with improving governance capabilities, can become one of several identity vendors to benefit from this growth vector.” Bachman added that many smaller, next-generation identity security vendors lack Okta’s scale, context, integrations and user trust. “We think that increasing rates of agent use and agent abuse can help drive more comprehensive identity investments among enterprises, as well as agent specific identity management purchases. We believe that Okta can benefit from both trends over the next several years,” the analyst added. Bachman applauded the two solutions Okta has recently launched to help its clients build and secure AI agents: Okta for AI Agents and Auth0 for AI agents. Already, early feedback appears to be positive, and he expects reception to continue to improve. “Broadly, we believe that IAM and identity security are gating factors to widescale enterprise adoption of agents, and as such, we think that identify vendors like Okta could be among the earlier beneficiaries of agent growth,” the analyst added.
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