Sometimes You Do Actually Have To Put The Work In (TWLO Q1 FY12/24 Earnings Review)

Sometimes You Do Actually Have To Put The Work In (TWLO Q1 FY12/24 Earnings Review)
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Twilio Q1 FY12/14 Earnings Analysis

by Alex King

Twilio is that rare beast, a free-money-bull-market hero that has both (1) dumped the obligatory 90% from its peak (February 2021 high, $457; October 2022 low, $41) and (2) had the gumption to turn its fundamentals around with the goal of yet delivering a decent outcome for any shareholder not dumb enough to buy big in the crazy days and not average down as it dumped. For lo and behold, this former money-chugging Ark Invest Poster Frat Boi is now generating 11% TTM unlevered pretax free cashflow margins. (*)

(*) OK OK OK only after you add back the one-time restructuring and writedown costs but, really, why shouldn't you do this? Sometimes this is the kind of work you have to do to get conviction on a stock (be that a conviction buy, or a conviction sell). Sometimes you have to look at what lies beneath, not just what the press release and every genius on CNBC or FinX tells you.

But, lookit, the adults are now in charge of this thing, earnings and cashflow are doing really well, revenue growth remains anemic but that will likely tick up soon and if it does? The stock can really respond I think. And I remain of the view that someone will buy the company at a worthwhile premium to today's stock price. Finally - the market is asking you to pay just 1.6x TTM revenue // 10.7x TTM EBITDA [yes with the one-time stuff added back] // 23x TTM unlevered pretax free cashflow with the one-time stuff added back. It's really not expensive in my opinion. But then I am long the stock, so perhaps it just seems that way to me.

Anyway. Read on. No headline table. You gotta do the work.

Twilio Financial Fundamental Analysis