Market Overview

Bank Of America Thinks Twilio Can Reach $1B In Revenue By 2020

Bank Of America Thinks Twilio Can Reach $1B In Revenue By 2020

Shares of Twilio Inc. (NYSE: TWLO) surged more than 30 percent after the company presented better-than-expected revenue, earnings and 2019 guidance.

The Analyst

Bank of America analyst Nikolay Beliov reiterated a Buy rating and increased the price target from $87 to $92.

The Thesis

The company’s results came in much higher than analysts’ expectations, according to Beliov. Some key highlights from the print included:

  • The increase of base revenue to 68 percent, compared to 54 percent in Q2 and 46 percent in Q1.
  • Gross margins of 55 percent, which are up from 53 percent in 2017.
  • International revenues accounting for 26 percent of total revenues, and demonstrating a higher growth rate than that in the U.S.

Overall, Beliov considers a $1 billion revenue milestone by 2020.

“Our thesis is re-enforced by 3Q results: 1) strong underlying business; 2) top 10 customer headwind becoming a tailwind as % of revenues from the top 10 customers declines from a peak of 32% in FY15 to 20% in FY17 to 15% in FY18E, becoming small enough that base revenues are re-accelerating, which was the case in Q1, Q2, and Q3; 3) set up for sustained beat/raise; and 4) clear path to $1bn in revs by FY20E," the note said.

Price Action

Twilio shares were up 34.4 percent to $95.49 at time of publication Wednesday.

Related Links:

KeyBanc: 5 Reasons To Be Aggressive On Twilio

Twilio Sells Off Following SendGrid Deal, But Analysts Remain Bullish

Latest Ratings for TWLO

Apr 2019FBN SecuritiesInitiates Coverage OnOutperform
Mar 2019KeyBancMaintainsOverweightOverweight
Mar 2019Deutsche BankMaintainsBuyBuy

View More Analyst Ratings for TWLO
View the Latest Analyst Ratings

Posted-In: Bank of America Nikolay BeliovAnalyst Color Earnings News Price Target Top Stories Analyst Ratings Best of Benzinga


Related Articles (TWLO)

View Comments and Join the Discussion!

70 Stocks Moving In Wednesday's Mid-Day Session

Creating Value In The Supply Chain Through TransportTech