Identity, User Credentials, Biggest Targets of Hackers

Hacker Group Breaches Gaming Industry. Last week, it was reported that both MGM resorts and Caesar's Entertainment Resorts were the victims of cyber attacks. According to blog posts by Mandiant, a division of Google (NC - GOOG), the hacker group UNC3944 was behind this attack. Per Mandiant "UNC3944 is a financially motivated threat cluster that has persistently used phone-based social engineering and SMS phishing campaigns (smishing) to obtain credentials to gain and escalate access to victim organizations". Mandiant's blog also noted "UNC3944 often achieves privilege escalation by targeting password managers or privileged access management systems".

Passwords, Credentials, privileged access all covered by Identity Vendors. It appears from the newsflow around the hacks at MGM and Caesars that some investors attributed the failure of users to protect their credentials as a failure of software vendors like Okta. Okta has confirmed that both MGM and Caesar's are in fact Okta customers. The company noted, however, that "these weren’t technology attacks against Okta — they appear to be social engineering attacks against people". At first glance, some might infer that the attacks are negatives for Okta. However, we believe that this only highlights the importance of new tools, processes and the services that identity security tools like Okta provide. We believe in the long run these types of public interest attacks will drive increased adoption of more tools from vendors like Okta.

Reiterate Buy Rating and $120 Price Target. We reiterate our Buy Rating and 12-month price target of $120 for Okta. Our price target is based on applying a 7x P/S target multiple on our FY26 sales estimate of $3.2bn.

OKTA

Okta, Inc.

CyberSecurity

Breaches Suggest Getting Hacked is Inevitable; Individuals The Big Weakness

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