Twilio Inc.
Twilio Inc. Fundamental Analysis
Twilio Inc. (TWLO) shows weak financial fundamentals with a PE ratio of 502.75, profit margin of 0.67%, and ROE of 0.43%. The company generates $5.1B in annual revenue with moderate year-over-year growth of 7.32%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 47.0/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze TWLO's fundamental strength across five key dimensions:
Efficiency Score
WeakTWLO struggles to generate sufficient returns from assets.
Valuation Score
ModerateTWLO shows balanced valuation metrics.
Growth Score
ExcellentTWLO delivers strong and consistent growth momentum.
Financial Health Score
ExcellentTWLO maintains a strong and stable balance sheet.
Profitability Score
ModerateTWLO maintains healthy but balanced margins.
Key Financial Metrics
Is TWLO Expensive or Cheap?
P/E Ratio
TWLO trades at 502.75 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, TWLO's PEG of -10.06 indicates potential undervaluation.
Price to Book
The market values Twilio Inc. at 2.17 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 45.25 times EBITDA. This signals the market has high growth expectations.
How Well Does TWLO Make Money?
Net Profit Margin
For every $100 in sales, Twilio Inc. keeps $0.67 as profit after all expenses.
Operating Margin
Core operations generate 3.22 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $0.43 in profit for every $100 of shareholder equity.
ROA
Twilio Inc. generates $0.35 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Twilio Inc. produces operating cash flow of $1.05B, showing steady but balanced cash generation.
Free Cash Flow
Twilio Inc. generates strong free cash flow of $1.04B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $6.78 in free cash annually.
FCF Yield
TWLO converts 6.03% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
502.75
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-10.06
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.17
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.38
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.15
vs 25 benchmark
Current Ratio
Current assets to current liabilities
4.03
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.004
vs 25 benchmark
ROA
Return on assets percentage
0.003
vs 25 benchmark
ROCE
Return on capital employed
0.02
vs 25 benchmark
How TWLO Stacks Against Its Sector Peers
| Metric | TWLO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 502.75 | 21.66 | Worse (Expensive) |
| ROE | 0.43% | 1190.00% | Weak |
| Net Margin | 0.67% | -55754.00% (disorted) | Weak |
| Debt/Equity | 0.15 | 1.32 | Strong (Low Leverage) |
| Current Ratio | 4.03 | 1.59 | Strong Liquidity |
| ROA | 0.35% | -202359.00% (disorted) | Weak |
TWLO outperforms its industry in 2 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Twilio Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
208.08%
Industry Style: Growth, Technology, Streaming
High GrowthEPS CAGR
72.07%
Industry Style: Growth, Technology, Streaming
High GrowthFCF CAGR
3897.18%
Industry Style: Growth, Technology, Streaming
High Growth