Even after a 20% surge on Friday, Goldman Sachs thinks Twilio shares have further room to run. The firm raised its rating on shares to buy from neutral. In addition, analyst Kash Rangan increased his price target to $185 per share from $77, indicating shares could climb an additional 35.8% from Friday’s close. TWLO YTD mountain Twilio shares in 2025 The cloud communications stock recorded its biggest jump since 2020 to close out last week. This came a day after the company raised its forward guidance at its analyst day. Twilio committed to cost cutting measures and bringing in $3 billion in free cash flow over the next three years, compared with around $692 million in free cash flow during 2022, 2023 and 2024. “Following multiple years of growth compression and several strategic actions, we believe Twilio is now hitting an inflection point both in terms of narrative and fundamentals,” Rangan wrote in a research note on Sunday. Even with the stock’s recent outperformance, potential upside to revenue growth forecasts, as well as a clearer strategy outlook and generative AI innovations leave more room for the stock to climb higher, according to the analyst. “Twilio’s turnaround story is firmly underway with potential for solid upside to Revenue/FCF in CY25 at what we view to be a still compelling entry point,” Rangan added. Shares have gained 26% in January, and have rallied 89.5% over the past 12 months. Analysts are somewhat split on the stock. According to LSEG, 18 of the 31 who cover Twilio rate it a buy or strong buy, while the remaining 13 have a hold or underperform rating. Baird last week upgraded the stock as well, assigning it an outperform rating and calling for around 40% upside .
Goldman Sachs upgrades Twilio, sees more than 35% upside ahead