TWLO Down 17% In A Month. How Confident Are You In The Stock?
Twilio (TWLO) stock is down 16.5% in 21 trading days. The stock looks attractive, but the history suggests it has a hard time recovering within a year following large dips. Consider the following data:
- Size: A $17 Bil company with $4.7 Bil in revenue currently trading at $108.67.
- Fundamentals: Last 12 month revenue growth of 11.6% and operating margin of 1.5%.
- Liquidity: Has Debt to Equity ratio of 0.1 and Cash to Assets ratio of 0.3
- Valuation: Currently trading at P/E multiple of 822.5 and P/EBIT multiple of 229.5
- Has returned (median) -14.1% within a year following sharp dips since 2010. See TWLO Dip Buy Analysis.
While we like to buy dips if the fundamentals check out – for TWLO, see Buy or Sell TWLO Stock – we are wary of falling knives. Specifically, it is worth trying to answer if things get really bad, and TWLO drops another 20-30% to $76.07 levels, will we be able to hold on to the stock? What is the worst case scenario? We call it downturn resilience.
Below is a deep dive into Twilio (TWLO) downturn resilience – specifically, its performance vs the market during past crises? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
Below are the details, but before that, as a quick background: TWLO provides a cloud communications platform that enables developers to build, scale, and operate customer engagement within software applications globally.
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2022 Inflation Shock
- TWLO stock fell 90.4% from a high of $443.49 on 18 February 2021 to $42.74 on 4 November 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is $148.35 on 30 January 2025 , and currently trades at $108.67
| TWLO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -90.4% | -25.4% |
| Time to Full Recovery | Not Fully Recovered days | 464 days |
2020 Covid Pandemic
- TWLO stock fell 45.6% from a high of $131.90 on 4 February 2020 to $71.70 on 16 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 7 May 2020
| TWLO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -45.6% | -33.9% |
| Time to Full Recovery | 52 days | 148 days |
2018 Correction
- TWLO stock fell 39.3% from a high of $149.95 on 26 July 2019 to $91.06 on 7 November 2019 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 7 May 2020
| TWLO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -39.3% | -19.8% |
| Time to Full Recovery | 182 days | 120 days |
Worried that TWLO could fall much more? You could take a look at the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.