Sam Badawi(@Sam_Badawi):OKTA JOINS THE S&P 500, BUT AT WHAT COST? Okta $OKTA is joining the S&P 500 $SPY, replacing Kenvue $KVUE following its pending acquisition by Kimberly-Clark $KMB. Okta is a strong cybersecurity company specializing in identity management, with revenue growing 11% YoY, a 13% GAAP operating margin, and a 28% free cash flow margin. However, trading at roughly 11-12x sales with a beta of 0.73 versus Kenvue’s 0.45, I believe Okta remains expensive and introduces additional volatility into the index. This reflects a broader trend of the S&P 500 becoming increasingly exposed to growth stocks with premium valuations, so don’t be surprised if market swings become much sharper in both directions.

2026.10.30 22:04

OKTA JOINS THE S&P 500, BUT AT WHAT COST? Okta $OKTA is joining the S&P 500 $SPY, replacing Kenvue $KVUE following its pending acquisition by Kimberly-Clark $KMB. Okta is a strong cybersecurity company specializing in identity management, with revenue growing 11% YoY, a 13% GAAP operating margin, and a 28% free cash flow margin. However, trading at roughly 11-12x sales with a beta of 0.73 versus Kenvue’s 0.45, I believe Okta remains expensive and introduces additional volatility into the index. This reflects a broader trend of the S&P 500 becoming increasingly exposed to growth stocks with premium valuations, so don’t be surprised if market swings become much sharper in both directions.