The stock market saw a sharp pullback on Thursday morning, continuing the choppy trading we've seen recently. Several factors came into play, including conflicting readings on economic strength and nervousness about the coronavirus vaccine rollout and potential efforts in Washington to help Americans financially. At 11:30 a.m. EST, the Dow Jones Industrial Average (^DJI 0.03%) was down 244 points to 31,369. The S&P 500 (^GSPC 0.01%) had fallen 32 points to 3,900, and the Nasdaq Composite (^IXIC -0.30%) had moved lower by 154 points to 13,811.
Yet even amid the sea of red on Wall Street, there were a couple of companies that fared quite well. Both Twilio (TWLO 1.19%) and loanDepot (LDI 1.10%) moved sharply higher even in the down market, and investors liked what they heard from the two high-growth companies and the implications their reports have for the future of their stocks.
Twilio makes a connection
Shares of Twilio rose almost 8% on Thursday morning. The cloud-based communications specialist reported fourth-quarter financial results that confirmed the swift growth that its business has seen recently.
The numbers from Twilio were impressive. Revenue for the fourth quarter jumped 65% from the year-ago period, capping a year of 55% top-line growth for the company. Dollar-based net expansion rates of 139% for the fourth quarter and 137% for 2020 as a whole showed that customers are adding to the services they get over time, pointing to the success of Twilio's cross-selling efforts to existing clients. The company now boasts more than 221,000 active customer accounts, up 42,000 from a year ago.
Twilio also expects the good times to continue. It projected guidance for first-quarter sales to grow between 44% and 47%. That might seem like a slowdown, but Twilio has historically been quite conservative in its guidance.
The only cloud in the report was Twilio's projection of an adjusted loss of $0.09 to $0.12 per share in the first quarter. However, with the company having posted adjusted earnings of $0.04 per share for the fourth quarter and $0.23 per share for the full year of 2020, Twilio appears to be solidly on the path to consistent and sustained profitability.
loanDepot makes a strong debut
Elsewhere, shares of loanDepot were up 4%. The financial stock had been up as much as 15% earlier in the session, with the newly public company having announced its inaugural earnings report.
The news from loanDepot was encouraging, with the company posting record quarterly loan originations of $37.4 billion in the fourth quarter, bringing in record annual sales of $4.3 billion and $2.01 billion in net income on a reported basis. Loan origination volume for the full year of 2020 more than doubled, topping the $100 billion mark.
The big question for loanDepot is how much the current financial environment boosted its business temporarily. Interest rates have started to move higher lately, and that might well have prompted borrowers to take one last chance to drive refinancing. Moreover, a rise in rates could make it harder for homebuyers to afford home purchases, potentially hurting future volume as well.
Nevertheless, for now, investors seem comfortable that loanDepot has tapped into favorable trends so effectively. Shareholders will have to wait and see how the mortgage lender responds if conditions turn more adverse.
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