Twilio (NYSE:TWLO) stock is down slightly today after the cell phone communications company reported mixed first-quarter financial results.
Importantly, the declines in early morning trading follow great volatility. As MarketWatch reported, shares initially plunged before reversing course and then declining again.
For shareholders, this is likely frustrating. Shares have fallen 56% so far in the year to date and are down 63% over the past six months. Investors will likely note that Twilio follows a pattern of other technology stocks that have steeply sold off in recent months.
However, things could be changing. Yesterday the Federal Reserve raised its benchmark interest rate by 50 basis points and signaled that a larger, 75-basis-point rate hike is not being considered by the central bank. So, will Twilio’s solid Q1 lead to a sustained rally in its stock?
Here are five things investors should know about Twilio and its Q1 print.
5 Things to Know About TWLO Stock
- For the period ended March 31 this year, Twilio “broke even” on $875.4 million in revenue. This figure was up 48% year over year and higher than the $863.81 million that analysts expected.
- Looking ahead to the current second quarter, Twilio expects revenue between $912 million and $922 million, representing a growth rate between 36% and 38%. This also suggests slowing growth, something which may be spooking investors today.
- Twilio also said it would lose between 23 cents and 20 cents during Q2.
- In March 2022, the U.S. Securities and Exchange Commission (SEC) charged two Twilio engineers with insider trading.
- In April, Twilio announced that it had hired a new chief digital officer and a chief privacy officer.
What’s Next for Twilio
Twilio stock has traded in a volatile pattern over the past six months, and that volatility has accelerated following reports of the insider trading charges. Among 26 analysts who cover the company, the median price target on TWLO stock is currently $285.05, suggesting nearly 150% upside from its current level.
Clearly, Wall Street feels Twilio has upside potential despite its current issues. The Q1 results are likely to be seen as a tentative step in the right direction for the company.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
