Do Fin Pros Know Something That You Don’t?

[View in browser]( [The Juice Logo] BROUGHT TO YOU BY: [Logo]( Editor’s Note It’s Friday. Time to give you a stock pick from our sister newsletter, The Spill, so you can think about it over the weekend and maybe make a move Monday morning. While The Juice helps you be better with money across the board, The Spill focuses on stocks financial pros are researching and judges how good of buys they are. If you’re already sold, you can sign up for The Spill – for free – here. [-facebook-share]( [-twitter-share]( [-linkedin-share]( [-email-share](mailto:?body= %3Cbr+%2F%3E%0A%3Cb%3EFatal+error%3C%2Fb%3E%3A++Uncaught+Error%3A+Cannot+use+object+of+type+stdClass+as+array+in+%2Fvar%2Fwww%2Fhtml%2Fnl_forms%2Fsrc%2FICTheJuiceAlternate%2Fautomate-ic-article.php%3A43%0AStack+trace%3A%0A%230+%2Fvar%2Fwww%2Fhtml%2Fnl_forms%2Fsrc%2FICTheJuiceAlternate%2Fautomate-ic-article.php%28136%29%3A+get_duplicate_article_id%28%29%0A%231+%7Bmain%7D%0A++thrown+in+%3Cb%3E%2Fvar%2Fwww%2Fhtml%2Fnl_forms%2Fsrc%2FICTheJuiceAlternate%2Fautomate-ic-article.php%3C%2Fb%3E+on+line+%3Cb%3E43%3C%2Fb%3E%3Cbr+%2F%3E?utm_medium=ic-nl&utm_source=112030 ) Proprietary Data Insights Financial Pros’ Top IT Services Stock Searches in the Last Month Rank Name Searches #1 'Shopify 212 #2 'Twilio 165 #3 'Cloudflare 84 #4 'MongoDB 38 #5 'Okta 26 #ad [The Most Researched Stocks [FREE REPORT]]( Brought to you by [Masterworks]( [As “Decade of Lost Wealth” looms, where do experts recommend $500k+ portfolios invest?]( [ Masterworks - As “Decade of Lost Wealth” looms, where do experts recommend $500k+ portfolios invest?]( Eye-opening Goldman Sachs research suggests investors could be facing a brutal decade as high inflation leads to real returns of only 1-3% per year. How can savvy investors keep their financial goals on track? One exclusive investment platform is giving investors access to an asset whose prices outpaced the S&P 500 by 131% over the last 26 years. It's called Masterworks. Now, their members can invest in multi-million dollar art. Just last year, Masterworks sold 9 paintings, including returns of 13.9%, 35%, and 10.4%. You can skip the waitlist using this exclusive VIP link. [Skip the waitlist]( *See important Reg A disclosures at [masterworks.com/cd](. TWLO - Fin Pros Might Be On To Something Bubbles make it difficult to see good companies amidst the chaos. So, when Twilio (TWLO) crashed +85% from its all-time highs, retail investors forgot about the stock… …but not financial pros. According to our TrackStar search volume, they’ve had their eye on the stock for some time. And its latest earnings drew more eyeballs to the stock when it delivered a surprising quarterly profit. Here’s why… Twilio’s Business Before Twilio, if you wanted any time of communication in your app, it required custom development, and thus $$$. Twlio’s APIs allow developers to embed voice, messaging, video, and email directly into apps. Plus, their programmable communication allows users to scale the way they want, meeting their security and compliance needs. With their SaaS model, Twilio allows customers to pay as they go. Twilio's latest quarterly report for Q2 2023 showcased strong growth and profitability, with revenue reaching $1.01 billion, a 15% increase year-over-year. The acquisition of Zipwhip, a business texting platform, contributed to this growth. The report also highlighted a non-GAAP operating income of $103.8 million, reflecting improved efficiency. However, the quarter also saw a GAAP net loss per share of $1.84, including expenses associated with restructuring. Investors worry slowing growth may be here to stay. After years of +30% revenue growth, forecasts put this year at just 16.7%. [Revenue] [Source: Twilio Q2 ‘23 Earnings Deck]( Financials [Financials] Source: Stock Analysis Twilio generated $83.6 million in cash from operations last quarter, its first positive cash quarter since Q3 ‘21. SG&A expenses have dropped dramatically since then to 40.8% of revenues compared to 53.1%, while gross margins slipped by 1%. In 2020, Twilio was cash flow positive the entire year, largely due to managed SG&A costs and higher gross margins. The company laid off 25% of its workforce but needs to do more to improve its margins. However, the company has net cash of $2.5 billion, meaning it’s got more cash than debt, giving it plenty of room to invest in improvements. Valuation [Valuation] Source: Stock Analysis While TWLO doesn’t generate a GAAP profit, neither does its peers. However, they generate positive cash flow, so everyone from Shopify (SHOP) to Okta (OKTA) trades at a higher price-to-sales ratio. Growth [Growth] Source: Seeking Alpha Additionally, all TWLO’s peers, especially Cloudflare (NET), are forecasting revenue growth over 20% this year. But if you look at the last few years, they all have relatively similar average annual revenue growth. Profitability [Profit] Source: Seeking Alpha TWLO and SHOP have the lowest gross margins compared to NET, MongoDB (MDB), and OKTA. But since none of them are profitable, that’s the only margin where they’re positive. [Are Alternative Investments a gray area? The Alt can add some color.]( The most profitable investors stay informed and up to date. Stay on top of Alternative Investment trends with credible articles and videos directly to your inbox with our hand-curated newsletter The Alt. [Subscribe now.]( Our Opinion 5/10 While Twilio is on its way to becoming solidly profitable, it’s not quite there. Plus, growth is on the decline, so they’ll need to find a way to improve their business as is. We would rather invest in its peers where growth and cash flow exist. 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