Twilio (TWLO) has captured investor attention following a surge in its AI-powered customer engagement platform as well as its multi-product sales approach. Recent results showed voice AI customer revenue up nearly 60% and record free cash flow.

Twilio’s impressive jump in voice AI customer revenue and robust free cash flow have kept its momentum building, with a 10.2% 1-month share price return and recent gains pushing its latest price to $120.57. Over the past year, the stock has delivered a 15.5% total shareholder return as investors continue to respond positively to Twilio’s execution and growth narrative, despite some past volatility.

If you’re tracking how customer engagement trends are lifting select tech names, now is the perfect time to broaden your search and discover fast growing stocks with high insider ownership

With Twilio’s impressive execution and upbeat analyst sentiment, the real question for investors is clear: Is the stock trading at an attractive value, or is the market already factoring in all of its anticipated growth?

Most Popular Narrative: 12.7% Undervalued

Twilio's most followed narrative sets its fair value notably above the last close, highlighting bullish projections despite recent volatility. It is a markedly optimistic stance, especially when compared to recent trading levels.

Growing adoption of AI-powered communications and automation is fueling incremental demand for Twilio's programmable infrastructure and platform products (e.g., ConversationRelay, conversational intelligence). This is expanding the company's addressable market and driving higher-margin revenue growth, which supports future revenue and net margin expansion.

There is one transformative assumption at the heart of this valuation: a belief in powerful revenue expansion underpinned by next-wave AI offerings. The full narrative unpacks significant profit milestones and margin projections that could change how you see Twilio’s future. Want to see the critical forecast details shaping that fair value? Uncover the numbers that move the target price now.

Result: Fair Value of $138.04 (UNDERVALUED)

However, ongoing pressure on Twilio’s gross margins and regulatory hurdles could quickly challenge the company’s margin outlook and undermine longer-term earnings growth.

Shares of TechNova climbed on Thursday after the company announced the launch of its new artificial intelligence platform. The stock gained nearly 5 percent in midday trading as investors welcomed the news. According to company executives, the new platform is designed to help businesses automate data analysis and streamline workflows. TechNova's CEO stated that the platform represents a significant step forward in the company's strategy to expand its AI offerings. Industry analysts noted that this move positions TechNova competitively within the growing artificial intelligence market. The company plans to begin rolling out the platform to select clients in the coming months. TechNova shares have experienced volatility recently amid shifting investor sentiment around technology stocks. Thursday's rally followed a week of steady declines.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Twilio for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 918 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Twilio Narrative

If you see Twilio’s story differently or want to dig into the data yourself, you can build your own perspective in just a few minutes. Do it your way.

A great starting point for your Twilio research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.