Okta, Fortinet, C3.ai in focus as KeyBanc switches ratings

Okta (NASDAQ:OKTA), Fortinet (NASDAQ:FTNT) and C3.ai (NYSE:AI) were in focus on Thursday as investment firm KeyBanc Capital Markets upgraded the first two and downgraded the third for a variety of different reasons.

Okta and Fortinet were up 1.5% in premarket trading, while C3.ai fell 2.9%.

“Within IT, security and data/analytics remain the top two priorities, behind [generative AI],” analysts at the firm wrote in a research note. “In security, we are incrementally more positive on the outlook for identity and firewall in 2025, and as such, we are upgrading shares of OKTA and FTNT to Overweight.”

The analysts raised their ratings on Okta and Fortinet to Overweight from Sector Weight and upped their respective price targets to $115 each. C3.ai was cut to Underweight with a $29 price target.

The firm also said it is positive on Snowflake (SNOW) in the data and analytics market going into 2025, as the data warehouse market is “an underappreciated beneficiary of [generative] AI.”

Okta

Delving a bit deeper, KeyBanc’s analysts said they like Okta’s “widening lead as a top priority within security,” as well as the stock’s attractive risk-reward at current levels, compared to its peers.

There’s also the possibility that seat headwinds go by the wayside in fiscal 2026, due in part to potential small and medium-sized business strength, per a recent survey.

The company’s identity governance and privileged access management products could start to contribute and there is the potential for Okta’s Customer Identity and Access Management to accelerate, with a better go-to-market strategy, the analysts said.

Fortinet

The analysts raised their rating on Fortinet on the expectation that the cybersecurity industry sees a larger “industry-wide refresh opportunity” than what is currently expected, as well the fact the company’s own refresh opportunity is not “sufficiently captured in consensus estimates.”

Lastly, Fortinet has proven to be differentiated in the Secure Access Service Edge market to the point where it is competitive, the analysts said.

C3.ai

Analysts at the firm cut their rating on C3.ai as the stock is trading at 13.3 times revenue and only growing between 10% and 20%, leading to an “unfavorable” risk-reward.

The analysts are also concerned estimates for fiscal 2026 and 2027 are “too high,” as subscription revenue growth excluding upfront license has slowed to 1%.

Additional worries include C3.ai’s operating losses and the risk if its Baker Hughes deal is not renewed in fiscal 2026 or if the Microsoft (MSFT) “partnership does not yield material results.”