UPDATE: Twilio (TWLO) PT Raised to $500 at Morgan Stanley as Levers for Outsized Growth Remain Attractive
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Morgan Stanley analyst Meta Marshall raised the price target on Twilio (NYSE: TWLO) to $500.00 (from $370.00) after the company recorded 65% revenue growth in Q4 (59% organic), an acceleration from 52% growth in Q3. Excluding political related traffic of $22.7mm and $23mm contribution from Segment, TWLO revenue grew 52%, 200bps ahead of Q3 growth when backing out ~$10mm in political traffic. Transactions with Global 2000 customers increased 76% over the last year and the number of 7-figure deals overall was up 93% Y/Y in 2020. A number of larger deals Twilio discussed included usage of various channels and products, pointing to the depth of customer
engagement. Continued investment in SI partnerships, specifically with Deloitte, as well as with potential for additional SI partnerships to come on board, can help to further drive penetration into larger enterprises that are likely to come with larger usage / deals.
The analyst stated "Levers for continued outsized growth remain attractive, particularly as global system integration relationships mature, acquired companies cross-pollinate (e.g. still more opportunity with SendGrid and just at the start of Segment integration), and travel/ridesharing/hospitality usage rebound. Overall, further confidence in TWLO's growth trajectory drives our PT higher (increasing to $500 from $370) as we align with higher growth expectations and appreciation in growth-adjusted software multiples; remain OW."
while maintaining a Overweight rating.
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