Shares of Okta Inc.
OKTA,
-2.75%
dropped 4.3% in afternoon trading Thursday, putting them on track to close at a near two-year low, following a double downgrade by Raymond James analyst Adam Tindle. The downgrade comes on the heels of the announcement by the provider identity management services for businesses it was investigating a potential digital breach of its software, and criticism that the disclosure of the potential break took too long. In a note titled “Too many strikes, we’re out,” Raymond James’ Tindle cut his rating to market perform from strong buy, skipping outperform in the process. Tindle said he had expected by now to see some signs of customer identity and ramping of its access management (CIAM) acceleration and privileged access and identity governance (PAM/IGA) offerings. Instead, Tindle said his channel checks suggest “a continually disconnected CIAM go-to market strategy,” and that PAM/IGA offerings have been “lacking true technological functionality.” In addition, Okta’s handling of the security incident “adds to out mounting concerns.” The stock, which is headed for the lowest close since April 14, 2020, has tumbled 36.6% year to date, while the ETFMG Prime Cyber Security ETF
HACK,
+0.73%
has slipped 5.3% and the S&P 500
SPX,
+0.86%
has lost 5.7%.