Analysts Are Downgrading These 5 Stocks

04. Twilio Inc. (NYSE:TWLO)

Number of Hedge Fund Holders: 48

In a research note issued on May 12, Mizuho downgraded Twilio Inc. (NYSE:TWLO) from Buy to Neutral and adjusted the price target from $90 to $55. The analyst explains that Twilio Inc. (NYSE:TWLO) Q1 guidance, projecting a 4%-5% year-over-year revenue growth, fell significantly below the consensus estimate of 11%. This disparity is attributed to the challenging macroeconomic conditions and the ongoing impact of tough comparisons from the cryptocurrency sector, which are expected to continue exerting pressure on growth in the near term. Mizuho anticipates subdued growth for Twilio Inc. (NYSE:TWLO) in the near term and does not foresee any immediate catalysts that would drive the stock’s performance.

Aristotle Atlantic Focus Growth Strategy made the following comment about Twilio Inc. (NYSE:TWLO) in its Q4 2022 investor letter:

“We sold Twilio Inc. (NYSE:TWLO) and thereby reduced our subsector weight in software. The company reported a decent third quarter, but disappointed on fourth quarter 2022, full year 2023, and long-term guidance. The company is seeing macroeconomic headwinds and a slowdown spreading from technology, social media and cryptocurrency to retail and e-commerce. The other negative disclosure and a driver of this gross margin “miss” was that Twilio’s software sales are not accelerating at the rate that we expected. We are disappointed with this lower topline and low operating margin improvement guidance. The business transformation is taking longer than expected, and there is the heightened possibility that the new software growth could be stifled by more formidable competition as Twilio has made too many missteps.”