TWLO
Twilio Inc.
$209.00
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 39.8% above fair value
You pay
$209.00
Bear
$101.73
Fair
$149.51
Bull
$202.03
Bear
$101.73
-51.3%
9% stage 1 growth, 12% discount
Fair
$149.51
-28.5%
15% stage 1 growth, 12% discount
Bull
$202.03
-3.3%
19% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (15% base case)
Terminal Value % of EV
38%
Implied Market Multiple
52.1x
Market is pricing in (growth)
23.8%
vs 14.7% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $220.92 from 52 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $149.51 per share.
Warnings
Stock-based employee pay equals 1775% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $220.92 (from 52 analysts). Our estimate is 50% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions