Twilio (TWLO) PT Raised to 'Street High' $550 at Oppenheimer on 'Unprecedented' Growth Rate
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(Updated - November 16, 2020 8:57 AM EST)
Oppenheimer analyst Ittai Kidron raised the price target on Twilio (NYSE: TWLO) to a 'Street High' $550.00 (from $350.00) while maintaining an Outperform rating saying the company's growth rate at this scale is “unprecedented”.
The analyst screened over 100 software companies, to find out that only ServiceNow looks on the right track to achieve around $4.0 billion in revenue while sustaining a 30% growth this year. Kidron predicts that TWLO will join this “elite club” by 2023.
“We believe Twilio can unlock a massive opportunity with G2K customers by bundling and addressing complete use cases (Contact Center, Marketing Campaigns, etc.). This could accelerate G2K customer adoption (only 359 in 2Q20) and drive higher spend per customer (only $83.6K in 2Q20). Our sensitivity analysis suggests a ~$225M opportunity (Exhibit 4) in 4Q24 as G2K adoption/expansion improves (vs. $30M in 2Q20),” Kidron wrote in today’s note.
“While momentum here can sustain >30% growth NT, Twilio's looking ahead and is deepening its competitive moat with Segment. Blending communication with data improves customer experiences and offers attractive monetization opportunities.”
Overall, he believes that the combination of product (every communications channel), GTM (developer/enterprise), and data (Segment) differentiation will likely unlock massive growth potential for TWLO.
The stock is rated as “Outperform” with a price target of $550.00 representing a premium of nearly 100% compared to Friday’s closing price of $285.67.
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