The Zacks Analyst Blog Twilio and Alphabet

For Immediate ReleasesChicago, IL – February 12, 2025 – Zacks.com announces the list of stocks and ETFs featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Twilio Inc. TWLO and Alphabet Inc. GOOGL.Here are highlights from Wednesday’s Analyst Blog:High-Flying Twilio a Must-Buy Ahead of Q4 EarningsTwilio Inc., a leading provider of cloud communications Platform-as-a-Service (PAAS) in the United States and internationally, will report fourth-quarter 2024 earnings results on Feb. 13, after the closing bell. The stock currently carries a Zacks Rank #1 (Strong Buy) and has an Earnings ESP of +3.28%. You can see the complete list of today’s Zacks #1 Rank stocks here.Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better (Rank #1 or 2) and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after their earnings release. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Find the latest earnings estimates and surprises on Zacks Earnings Calendar.Factors to ConsiderTwilio has been benefiting from accelerated digital transformations amid a growing hybrid working trend. TWLO’s selective acquisitions and strategic investments in businesses and technologies have been enhancing its product portfolio and fortifying its global presence.The company has been gaining traction not only from the solid expansion of its existing clientele but also from first-time deals with new customers due to its firm focus on introducing products and a go-to-market sales strategy. TWLO’s ongoing cost-saving initiatives have been driving profits and margins, which is praiseworthy.Twilio has been witnessing tremendous demand for its programmable voice and messaging products, which is favoring its top-line performance. Furthermore, TWLO’s consistent efforts in developing innovative use-case products will continue to boost its revenues in the long run. A sturdy uptick in TWLO’s Engagement Cloud offerings as well as email with the inclusion of SendGrid is a key catalyst.The company has been striving to gain more and more enterprise customers, as they bring in more stable revenues for the long term. TWLO mainly generates sales through online model, but in order to grab more market share, it has increased its investment on building traditional sales team. Furthermore, TWLO rolled out – Enterprise Plan – for enterprise customers with more compliance, administrative and security features.Major Long-Term Catalyst: Extensive Application of AITwilio is focusing on generative artificial intelligence (AI) offerings to tap the growing opportunities in the space. In this regard, TWLO launched Customer AI technology in June 2023, which powerfully combines customer engagement platform data, generative and predictive AI, and large language models (LLMs) to unlock stronger customer relationships for brands.TWLO is integrating generative AI capabilities across its platform and every customer touch point. The company believes that by training LLMs for customers with their data inside its Segment customer data platform, Twilio will be able to help customers enter the AI race multiple steps ahead of their peers.The company has also partnered with Alphabet Inc.  for Google Cloud to integrate generative AI into the Twilio Flex customer engagement platform. Twilio’s initiative to integrate generative and predictive AI technology across its platform will likely boost its revenue growth over the long-run.In August 2023, Twilio announced that it will enable companies to create personalized, customer-aware experiences powered by OpenAI. Through this integration, Twilio customers will be able to use OpenAI’s GPT-4 model to power new generative capabilities in Twilio Engage, its multichannel marketing solution built on the Segment Customer Data Platform.Solid Earnings Estimate Revisions for TWLO StockFor fourth-quarter 2024, the Zacks Consensus Estimate currently shows revenues of $1.17 billion, suggesting an improvement of 9% year over year and earnings per share (EPS) of $1.02, indicating an increase of 18.6% year over year.The Zacks Consensus Estimate for fourth-quarter 2024 earnings has improved by 2% over the past 30 days. Twilio reported positive earnings surprises in the last four reported quarters with an average beat of 31%.At present, the Zacks Consensus Estimate indicates a year-over-year increase of 6.8% and 50.6%, respectively, for revenues and EPS in 2024. Even after this strong projection, the current Zacks Consensus Estimate for 2025 revenues and EPS reflects an upside of 7.6% and 17.6%, respectively.The Zacks Consensus Estimate for 2025 earnings has improved 0.9% over the past 60 days. TWLO currently has a long-term (3-5 years) EPS growth rate of 28.7%, well above the S&P 500’s long-term EPS growth rate of 12.4%.Investment Thesis for TWLO SharesThe stock price of Twilio has jumped 33.5% year to date. Despite the rally, the stock has more upside left as its favorable Zacks Rank and a possible earnings beat are expected to drive prices northward in the near-term.Moreover, extensive application of generative and predictive AI will enable TWLO to differentiate its products in a competitive scenario. Additionally, Twilio is a cash-rich company with a strong balance sheet. This will not only guarantee protection but is also likely to reward shareholders from its heavy cash registers.As of Sept. 30, 2024, Twilio had cash and marketable securities of $2.7 billion, while the long-term debt totaled $990 million. Since it has net cash available on its balance sheet, the existing cash can be used for pursuing strategic acquisitions, investing in growth initiatives and rewarding shareholders.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.com                                     https://www.zacks.com                                                 Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alphabet Inc. (GOOGL): Free Stock Analysis Report Twilio Inc. (TWLO): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks