Mizuho upgrades Twilio to Outperform into investor day

Mizuho upgraded Twilio (TWLO) to Outperform from Neutral with a price target of $140, up from $85, ahead of the company’s January 23 investor day. The firm expects “meaningful” sales stabilization and improved revenue visibility for Twilio, and sees opportunity for acceleration to double-digit growth in 2025 and beyond. It expects management to provide a 2025 non-GAAP operating margin guide ahead of consensus and raise longer-term target to 22%-plus, prompting positive revisions to income and free cash flow estimates. Mizuho also thinks Twilio could announce a new share buyback. While the shares appreciated 50% in 2024, greater clarity on the drivers of the sales stabilization and acceleration opportunity, along with a refreshed mid-term growth outlook, will support share outperformance, the analyst tells investors in a research note.