Software Stocks, Software As A Service Stocks


Twilio reported earnings after the close yesterday

Software concern Twilio Inc (NYSE:TWLO) is plummeting today, last seen down 12% to trade at $86.40 ahead of Wall Street’s open. The company stepped into the earnings confessional last night, where it reported slimmer-than-expected losses and a revenue beat for the second quarter. However, the company’s weaker-than-anticipated third-quarter outlook is weighing on the shares today, and analysts are responding in turn.

No less than nine members of the brokerage bunch slashed their price targets on TWLO. Stifel stood out amongst the firms, adjusting its price objective to $90 from $200 and downgrading the equity to “hold” from “buy,” stating it wants a “clearer picture” regarding the company’s timeline for achieving profitability.

This isn’t the first downgrade Twilio stock has seen of late, but it marks a contrast to the optimism covering brokerage firms held toward the equity coming into today. In fact, 13 of the 17 analysts in question rated the security a “strong buy,” while the 12-month consensus target price of $150.45 represents a hefty 73.9% premium to last night’s close.

Options traders likely aren’t happy with the news, as calls have rarely been more popular. This is per TWLO’s 10-day call/put volume ratio of 3.40 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 98% of readings from the past year. 

Should today’s negative price action hold, it will mark another rejection at the $100 area for the shares, while the $80 level still sits as a floor. What’s more, TWLO will once again fall beneath the 70-day moving average, which it toppled this week for the first time since October 2021. In the last 12 months, Twilio stock was already down 73.8% before today’s dip.



Image and article originally from www.schaeffersresearch.com. Read the original article here.

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