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Twilio Inc. (TWLO) Outpaces Stock Market Gains: What You Should Know

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Twilio Inc. (TWLO - Free Report) closed the most recent trading day at $112.85, moving +1.37% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.09%. Elsewhere, the Dow gained 0.26%, while the tech-heavy Nasdaq lost 0.25%.

Heading into today, shares of the company had gained 37.01% over the past month, outpacing the Computer and Technology sector's gain of 8.88% and the S&P 500's gain of 7.92% in that time.

TWLO will be looking to display strength as it nears its next earnings release, which is expected to be February 12, 2019. On that day, TWLO is projected to report earnings of $0.04 per share, which would represent year-over-year growth of 233.33%. Meanwhile, our latest consensus estimate is calling for revenue of $184.41 million, up 60.02% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for TWLO. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. TWLO currently has a Zacks Rank of #3 (Hold).

In terms of valuation, TWLO is currently trading at a Forward P/E ratio of 710.55. For comparison, its industry has an average Forward P/E of 55, which means TWLO is trading at a premium to the group.

Investors should also note that TWLO has a PEG ratio of 78.95 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Internet - Software stocks are, on average, holding a PEG ratio of 2.75 based on yesterday's closing prices.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 30, putting it in the top 12% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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