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Shares of cloud communications platform Twilio (TWLO - Free Report) , which made its market debut in June, gained over 7.5% in morning trading Tuesday after the stock received a bullish rating from Oppenheimer.
The Oppenheimer team, led by analyst Ittai Kirdron, initiated coverage of Twilio with an “Outperform” rating and a $50 price target. Coming into Tuesday, shares of TWLO were trading for around $34, but Kirdron sees an opportunity for the company to grow thanks to the adoption of “Application to Person” communication.
“Applications are increasingly pervasive in our lives and serve as the primary means of communication between businesses and customers, driving a need for communication between applications and users,” Kirdron wrote.
“Application to Person”—A2P for short—describes a type of communication wherein a business application sends a message to an actual person. In many cases, the person is not expected to respond; automated emails, emergency alerts, and special offer announcements are all examples of A2P messages.
Kirdron and the Oppenheimer team have recognized a changing of the guard, so to speak, in the demand for A2P communication services. The traditional sources of A2P communication are beginning to make way to cloud-based platforms like Twilio.
“Legacy A2P solutions lack the development agility, ease-of-use, and flexibility needed for today’s business environment. This is driving the adoption of cloud-based solutions, which interconnect with telecom networks and give developers easy-to-use APIs. Pointing to adoption, IDC estimates cloud platforms will account for 25% of the A2P messaging market in ’19 vs. <1% in ’15,” said Kirdron.
Twilio is expected to report its Q3 earnings in just two days, and it will be interesting to see if the company specifically mentions this growing demand in the A2P market. A few weeks ago, Twilio pre-announced some of its results; the company expects to see revenues of $70.25 million to $71.25 million and net loss per share of 14 to 15 cents.
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Here's Why Twilio (TWLO) Stock Is Gaining Today
Shares of cloud communications platform Twilio (TWLO - Free Report) , which made its market debut in June, gained over 7.5% in morning trading Tuesday after the stock received a bullish rating from Oppenheimer.
The Oppenheimer team, led by analyst Ittai Kirdron, initiated coverage of Twilio with an “Outperform” rating and a $50 price target. Coming into Tuesday, shares of TWLO were trading for around $34, but Kirdron sees an opportunity for the company to grow thanks to the adoption of “Application to Person” communication.
“Applications are increasingly pervasive in our lives and serve as the primary means of communication between businesses and customers, driving a need for communication between applications and users,” Kirdron wrote.
“Application to Person”—A2P for short—describes a type of communication wherein a business application sends a message to an actual person. In many cases, the person is not expected to respond; automated emails, emergency alerts, and special offer announcements are all examples of A2P messages.
Kirdron and the Oppenheimer team have recognized a changing of the guard, so to speak, in the demand for A2P communication services. The traditional sources of A2P communication are beginning to make way to cloud-based platforms like Twilio.
“Legacy A2P solutions lack the development agility, ease-of-use, and flexibility needed for today’s business environment. This is driving the adoption of cloud-based solutions, which interconnect with telecom networks and give developers easy-to-use APIs. Pointing to adoption, IDC estimates cloud platforms will account for 25% of the A2P messaging market in ’19 vs. <1% in ’15,” said Kirdron.
Twilio is expected to report its Q3 earnings in just two days, and it will be interesting to see if the company specifically mentions this growing demand in the A2P market. A few weeks ago, Twilio pre-announced some of its results; the company expects to see revenues of $70.25 million to $71.25 million and net loss per share of 14 to 15 cents.
Stocks that Aren't in the News. Yet.
You are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. Many of these companies are almost unheard of by the general public and just starting to get noticed by Wall Street. They have been pinpointed by the Zacks system that nearly tripled the market from 1988 through 2015 with a stellar average gain of +26% per year. See these high-potential stocks free >>