Twilio Maintains 'Buy' Rating, UBS Lowers Price Target to $150.00

UBS maintains a 'Buy' rating on Twilio (TWLO) while lowering its price target from $175 to $150. Analyst Taylor McGinnis made the adjustment while reaffirming confidence in the company's overall performance. Investors should consider this change in the context of their investment strategies, as the new price target aligns with current market conditions and prospects for Twilio. The average target price for Twilio is $125.67 with a high estimate of $175 and a low estimate of $75, implying an upside of 25.53% from the current price.

Twilio Inc. (TWLO) shares experienced a 9.1% surge in the extended trading session on Thursday, following the company's release of better-than-expected first-quarter results and an upward revision in its full-year 2025 guidance. The company's non-GAAP earnings of $1.14 per share exceeded the Zacks Consensus Estimate of 92 cents, marking a significant improvement over the year-ago quarter's earnings of 80 cents [1].

The robust year-over-year growth in earnings was primarily driven by increased revenues and cost discipline. Twilio's revenues for the quarter reached $1.17 billion, surpassing the consensus mark of $1.14 billion and management's guidance of $1.13-$1.14 billion. The top line soared 12% year over year, with the Communications division accounting for $1.10 billion in revenues, a 13% increase from the previous year. The Segment division's sales also showed a 1% increase to $75.7 million [1].

The company's non-GAAP gross profit increased by 6.3% year over year to $602 million, while the non-GAAP gross margin contracted by 280 basis points to 51.3%. The non-GAAP operating income jumped by 33.1% to $213 million, with the non-GAAP operating margin expanding by 300 basis points to 18.2% [1].

UBS recently downgraded its price target for Twilio from $175 to $150 while maintaining a 'Buy' rating. Analyst Taylor McGinnis made this adjustment while reaffirming confidence in the company's overall performance. The new price target aligns with current market conditions and prospects for Twilio. The average target price for Twilio is $125.67, with a high estimate of $175 and a low estimate of $75, implying an upside of 25.53% from the current price [2].

Investors should consider this change in the context of their investment strategies, as the new price target reflects a more conservative valuation of Twilio's stock. The company's strong Q1 results and upward revision in guidance underscore its continued growth potential, but the market's expectations for the stock may have been adjusted to reflect a more cautious outlook.

References:
[1] https://finance.yahoo.com/news/twilio-stock-soars-9-q1-125400071.html
[2] https://www.nasdaq.com/articles/twilio-stock-soars-9-q1-earnings-beat-fy25-guidance-raise