The digital communications stock gained ground in June in conjunction with market momentum and a string of price target hikes from prominent analysts. There wasn't much in the way of company-specific news for Twilio last month, but overwhelmingly positive coverage from leading firms helped the stock expand on the big gains it posted following stellar first-quarter results in May.
Analysts bumped their outlooks for Twilio stock after the company delivered an unexpected non-GAAP (adjusted) profit and blew past sales estimates in the first quarter while evidence of continued tailwinds emerged. Shares may have also gotten a boost from a surge of new coronavirus cases in the U.S. pointing to an extension of heightened demand for digital communications services.
Oppenheimer analyst Ittai Kidron published a note on June 1 raising his one-year price target from $160 to $230 per share and maintaining an "outperform" rating on the stock. Piper Sandler's Brent Bracelin upgraded the stock from a "neutral" rating to an "overweight" rating and bumped his price target from $135 to $225. Northland's analyst Michael Latimore upped his price target on the stock from $170 to $225 in a note on June 22, and analyst Heather Bellini raised the target at Goldman Sachs from $137 to $225 per share.
Twilio has continued to climb early in July's trading. The stock is up roughly 7% in the month so far.
Twilio's business has been red hot amid surging demand for its video, voice, and messaging technologies, and the company anticipates delivering another period of strong growth for the quarter that ended in June. Management is guiding for revenue between $365 million and $370 million in the second quarter -- good for year-over-year growth of 34% at the midpoint of the target. The company anticipates an adjusted loss between $0.08 and $0.11 in the period.
Twilio is valued at roughly 21 times this year's expected sales.