Twilio stock ( NYSE:TWLO ) dropped on Monday after Jefferies downgraded the cloud communications software provider, citing “continued headwinds” to the company’s growth in the near future and a low belief that it will grow revenue at a 30% or higher rate.
Analyst Samad Samana downgraded Twilio ( NYSE:TWLO ) from buy to hold and lowered his price objective from $110 to $50, pointing out that the outlook is no longer as promising as it once was, particularly in light of a poor analyst day.
Samana stated in a note to clients that “Twilio successfully selling the software solutions in its portfolio has been a significant element of our thesis that has not materialized.” The analyst also noted that the segment’s revenue growth has slowed, and recent measures to enhance it may succeed, but improvement is likely to be gradual.
Furthermore, Samana continued, “we feel that demand for front-office software and contact center solutions has slowed more generally, which we expect to have an impact on demand for Twilio’s software solutions portfolio as well.” In early trade, Twilio stock ( NYSE:TWLO ) decreased by 1.7% to $47.76.
Samana also noted that there has been a downturn in consumer activity, that tighter marketing budgets could result in slower messaging activity, and that macro headwinds and company-specific challenges are likely to result in slower growth.
Because of this, it’s likely that Twilio’s ( NYSE:TWLO ) growth will be slowed down in the short term by layoffs and the need to hire new sales reps. Twilio (TWLO) started a healthcar...
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