TWLO Stock Forecast: More Triple-Digit Returns for This Tech Disruptor

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Twilio Stock Will Ride Out of Choppy Waters

Twilio Inc (NYSE:TWLO) released a statement on October 15 that it will buy the e-mail marketing company SendGrid Inc (NYSE:SEND) for $2.0 billion in an all-stock transaction. (Source: “Twilio to acquire SendGrid, the Leading Email API Platform,” Twilio Inc, October 15, 2018.)

The news hit Twilio stock hard, and it has been trying to recover ever since. So, what’s the TWLO stock forecast?

Twilio builds cloud-based communication toolkits called Application Programming Interfaces (APIs) for messaging, voice, and video. With the help of these APIs, developers or programmers can easily enhance the communication functions of their apps or web sites to improve customer engagement.

Twilio gives developers the power to make a phone call with just a few lines of code. The company has evolved its platform to cover nearly every channel that companies use to communicate with their customers, including voice, video, short message service (SMS), smart assistants like “Alexa,” and messaging apps like “WhatsApp.”

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The only missing feature from Twilio’s platform has been e-mail. The SendGrid acquisition is aimed at bridging this gap. SendGrid has built the industry’s best cloud-based e-mail delivery platform and should help Twilio accelerate its mission to fuel the future of communications.

The deal brings together two leading communication platforms for developers. Together, the companies will serve millions of customers.

Although the competition is strong, Twilio has proven itself to be resilient. It deals with phone providers all over the world and has lots of goodwill among developers.

The number of developers that use its service has been rising. Twilio boasts Nordstrom, Uber, and OpenTable—among  many other big names—as its clients.

The company recently launched the Twilio API for WhatsApp. This will allow developers to easily add one of the most important global messaging channels to their applications.

Twilio’s Recent Performance

Despite its recent fall, TWLO stock has been one of the best-performing cloud stocks and is set to continue its upward march following its initial setback.

The cloud communications company announced its second-quarter results in August. Total revenue went up by 54% year-over-year to reach $147.8 million as Twilio’s core voice and messaging products grew strongly.

The company is still making losses, although the active customer accounts as of June 31 were around 57,350—compared to 43,431 in the second quarter of the previous year. (Source: “Twilio Announces Second Quarter 2018 Results,” Twilio Inc, August 6, 2018.)

Twilio was one of the hottest tech initial public offerings (IPOs) of 2016, and TWLO stock has gone up by about 150% since then. Over the past year, the stock price has gained more than 100%. The Twilio stock forecast remains upbeat.

Twilio Inc Stock Chart

Chart courtesy of StockCharts.com

Twilio has been disrupting the communications space for a long time. The company aims to transform communications from its legacy in hardware to its future in software. This means that software developers who have ideas about making communication better can just use Twilio APIs to do so.

Communications software is a market with huge potential, and it could result in more triple-digit returns for TWLO stock.

Analyst Take

Twilio has emerged as one of the strongest cloud communications platforms for companies to communicate with customers. Its services let developers easily attach various features to their apps, such as texting and phone calls.

The company’s acquisition SendGrid builds API tools that help businesses deliver marketing e-mails. The company is a good fit in Twilio’s portfolio. As the digital economy continues to grow, its software will disrupt a number of industries.

Being at the forefront of technological changes, Twilio is expected to post strong gains. Investors should not ignore this opportunity, and may want to consider Twilio stock on any sign of weakness.