Twilio (NYSE:TWLO) - Share price, News & Analysis

Q: What is the Fair Price of TWLO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

TWLO ($85.17) is trading above our estimate of [[fair value]] ($50.48)

TWLO fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	2/6
Past Performance	0/6
Financial Health	4/6
Dividends	0/6

TWLO Stock Overview

Rewards

Revenue is forecast to grow 22.33% per year

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year

Twilio Competitors

MongoDB

NasdaqGM:MDB

US$18.3b

Cloudflare

NYSE:NET

US$15.0b

Akamai Technologies

NasdaqGS:AKAM

US$14.8b

Shopify

NYSE:SHOP

US$39.6b

Price History & Performance

Summary of all time highs, changes and price drops for Twilio
Historical stock prices
Current Share Price	US$85.17
52 Week High	US$412.68
52 Week Low	US$77.14
Beta	1.54
1 Month Change	-22.01%
3 Month Change	-49.75%
1 Year Change	-78.09%
3 Year Change	-39.28%
5 Year Change	199.58%
Change since IPO	195.83%

Recent News & Updates

Jun 16

Can Twilio Stock Recover To $200? Don't Even Think About It

We believe Twilio's weak free cash flow profitability is a critical factor that worsened the market's perception of its valuation. Therefore, TWLO remains overvalued. Our price action analysis suggests that its near-term bottom has been breached. Therefore, investors should watch for a re-test of its $68 support zone. We reiterate our Hold rating on TWLO stock. Without a sustained bottom, investors should not even consider it reaching $200 anytime soon.

Jun 15

Is Twilio (NYSE:TWLO) Using Too Much Debt?

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' When we think about how risky a company...

Jun 01

Twilio: Normalization Aberration

Twilio still forecasts organic growth normalizing at 30% growth rates in an aberration from other tech stocks. The company is still generating losses causing the market to flee the stock. The stock trades at less than 4x '23 sales targets.

May 24

Twilio Q1 Review: Cautious Optimism

Twilio released Q1 earnings with Revenue beating estimates by a mere 1%. Q2 Guidance was weak as the company faces tough YoY comps. However, Twilio expects a reacceleration of growth for the back half of the year. Unprofitability remains the biggest concern when investing in Twilio, especially in today's market environment. However, the company has strong competitive advantages and remains the dominant player in the cloud communications and customer data platform category. On the other hand, the stock trades at the lowest valuation multiple ever, offering compelling value for investors.

Shareholder Returns

	TWLO	US IT	US Market
7D	-14.1%	-4.7%	-2.5%
1Y	-78.1%	-35.2%	-21.2%

Return vs Industry: TWLO underperformed the US IT industry which returned -35.2% over the past year.

Return vs Market: TWLO underperformed the US Market which returned -21.2% over the past year.

Price Volatility

Is TWLO's price volatile compared to industry and market?
TWLO volatility
TWLO Average Weekly Movement	12.2%
IT Industry Average Movement	9.9%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	3.3%

Stable Share Price: TWLO is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 12% a week.

Volatility Over Time: TWLO's weekly volatility (12%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2008	8,199	Jeff Lawson	https://www.twilio.com

Twilio Inc., together with its subsidiaries, provides a cloud communications platform that enables developers to build, scale, and operate customer engagement within software applications in the United States and internationally. Its customer engagement platform provides a set of application programming interfaces that handle the higher-level communication logic needed for nearly every type of customer engagement, as well as enable developers to embed voice, messaging, video, and email capabilities into their applications. The company was incorporated in 2008 and is headquartered in San Francisco, California.

Twilio Fundamentals Summary

How do Twilio's earnings and revenue compare to its market cap?
TWLO fundamental statistics
Market Cap	US$15.47b
Earnings (TTM)	-US$964.98m
Revenue (TTM)	US$3.13b

4.9x

P/S Ratio

-16.0x

P/E Ratio

Is TWLO overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
TWLO income statement (TTM)
Revenue	US$3.13b
Cost of Revenue	US$1.61b
Gross Profit	US$1.52b
Other Expenses	US$2.48b
Earnings	-US$964.98m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-5.31
Gross Margin	48.52%
Net Profit Margin	-30.86%
Debt/Equity Ratio	9.0%

How did TWLO perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is TWLO undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TWLO?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for TWLO. This is calculated by dividing TWLO's market cap by their current preferred multiple.
What is TWLO's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$15.47b

TWLO key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	3.7x
Enterprise Value/EBITDA	-17.2x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does TWLO's PS Ratio compare to its peers?

TWLO PS Ratio vs Peers

The above table shows the PS ratio for TWLO vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	12.9x
MDB MongoDB	18.7x	24.7%	US$18.3b
NET Cloudflare	20.5x	30.8%	US$15.0b
AKAM Akamai Technologies	4.2x	9.3%	US$14.8b
SHOP Shopify	8.2x	25.6%	US$39.6b
TWLO Twilio	4.9x	22.3%	US$15.5b

Forward PS

Price-To-Sales vs Peers: TWLO is good value based on its Price-To-Sales Ratio (4.9x) compared to the peer average (12.9x).

Price to Earnings Ratio vs Industry

How does TWLO's PE Ratio compare vs other companies in the US IT Industry?

Price-To-Sales vs Industry: TWLO is expensive based on its Price-To-Sales Ratio (4.9x) compared to the US IT industry average (2.4x)

Price to Sales Ratio vs Fair Ratio

What is TWLO's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TWLO PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	4.9x
Fair PS Ratio	8.1x

Price-To-Sales vs Fair Ratio: TWLO is good value based on its Price-To-Sales Ratio (4.9x) compared to the estimated Fair Price-To-Sales Ratio (8.1x).

Share Price vs Fair Value

What is the Fair Price of TWLO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TWLO ($85.17) is trading above our estimate of fair value ($50.48)

Significantly Below Fair Value: TWLO is trading above our estimate of fair value.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate TWLO's PEG Ratio to determine if it is good value.

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Future Growth

How is Twilio forecast to perform in the next 1 to 3 years based on estimates from 29 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

8.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: TWLO is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: TWLO is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: TWLO is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: TWLO's revenue (22.3% per year) is forecast to grow faster than the US market (8.2% per year).

High Growth Revenue: TWLO's revenue (22.3% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: TWLO's Return on Equity is forecast to be low in 3 years time (0.2%).

Discover growth companies

Past Performance

How has Twilio performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-54.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: TWLO is currently unprofitable.

Growing Profit Margin: TWLO is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: TWLO is unprofitable, and losses have increased over the past 5 years at a rate of 54.3% per year.

Accelerating Growth: Unable to compare TWLO's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: TWLO is unprofitable, making it difficult to compare its past year earnings growth to the IT industry (21.4%).

Return on Equity

High ROE: TWLO has a negative Return on Equity (-8.84%), as it is currently unprofitable.

Discover strong past performing companies

Financial Health

How is Twilio's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: TWLO's short term assets ($5.8B) exceed its short term liabilities ($719.8M).

Long Term Liabilities: TWLO's short term assets ($5.8B) exceed its long term liabilities ($1.3B).

Debt to Equity History and Analysis

Debt Level: TWLO has more cash than its total debt.

Reducing Debt: Insufficient data to determine if TWLO's debt to equity ratio has reduced over the past 5 years.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: TWLO has sufficient cash runway for more than 3 years based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if TWLO has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.

Discover healthy companies

Dividend

What is Twilio current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate TWLO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate TWLO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if TWLO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TWLO's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as TWLO has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

0.6yrs

Average management tenure

CEO

Jeff Lawson (45 yo)

14.25yrs

Tenure

US$14,625,745

Compensation

Mr. Jeffrey Lawson, also known as Jeff, has been Director of SendGrid Inc. since February 1, 2019. Mr. Lawson co-founded Twilio Inc. in 2008 and has been its Chief Executive Officer since April 2008 and Ch...

CEO Compensation Analysis

Compensation vs Market: Jeff's total compensation ($USD14.63M) is about average for companies of similar size in the US market ($USD13.43M).

Compensation vs Earnings: Jeff's compensation has increased whilst the company is unprofitable.

Leadership Team

Experienced Management: TWLO's management team is not considered experienced ( 0.6 years average tenure), which suggests a new team.

Board Members

Experienced Board: TWLO's board of directors are considered experienced (5.5 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: TWLO insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6.1%.

Data	Last Updated (UTC time)
Company Analysis	2022/07/02 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31