Analyzing Twilio (TWLO) and Its Peers

Twilio (NYSE: TWLO) is one of 63 public companies in the “Application Software” industry, but how does it weigh in compared to its competitors? We will compare Twilio to similar companies based on the strength of its valuation, earnings, analyst recommendations, profitability, risk, institutional ownership and dividends.

Volatility and Risk

Twilio has a beta of 3.26, indicating that its share price is 226% more volatile than the S&P 500. Comparatively, Twilio’s competitors have a beta of 1.68, indicating that their average share price is 68% more volatile than the S&P 500.

Profitability

This table compares Twilio and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Twilio -13.42% -15.40% -12.25%
Twilio Competitors -61.24% -92.99% -15.97%

Valuation and Earnings

This table compares Twilio and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Twilio $336.73 million -$34.74 million -59.38
Twilio Competitors $769.36 million $137.09 million -10.12

Twilio’s competitors have higher revenue and earnings than Twilio. Twilio is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of recent ratings for Twilio and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Twilio 1 1 15 0 2.82
Twilio Competitors 227 1658 2835 109 2.59

Twilio currently has a consensus target price of $37.93, suggesting a potential upside of 22.84%. As a group, “Application Software” companies have a potential upside of 1.81%. Given Twilio’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Twilio is more favorable than its competitors.

Insider & Institutional Ownership

84.3% of Twilio shares are owned by institutional investors. Comparatively, 70.8% of shares of all “Application Software” companies are owned by institutional investors. 16.0% of shares of all “Application Software” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Twilio beats its competitors on 8 of the 12 factors compared.

Twilio Company Profile

Twilio Inc. offers Cloud Communications Platform, which enables developers to build, scale and operate real-time communications within software applications. The Company’s platform consists of Programmable Communications Cloud, Super Network and Business Model for Innovators. Its Programmable Communications Cloud software enables developers to embed voice, messaging, video and authentication capabilities into their applications through its Application Programming Interfaces (APIs). Its Programmable Communications Cloud offers building blocks that enable its customers to build what they need. Its Programmable Communications Cloud includes Programmable Voice, Programmable Messaging, Programmable Video and Use Case APIs. The Super Network is its software layer that allows its customers’ software to communicate with connected devices globally. It interconnects with communications networks around the world.

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