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a day ago
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5 Must-Buy High-Flying Stocks With AI Frenzy Set to Dominate H2 2025
The astonishing rally of U.S. stocks in 2023 and 2024 continued in the first half of 2025, albeit at a slow pace. The rally was predominantly driven by the technology sector with an unprecedented adoption of generative artificial intelligence (AI) technology across the world. The AI-driven rally suffered multiple setbacks in first-half 2025 due to the unveiling of the low-cost Chinese DeepSeek AI platform, the Trump administration's decision to stop the export of high-end AI processors to China, global turmoil related to trade after President Trump imposed reciprocal tariffs and geopolitical conflicts in the Middle East. AI infrastructure space recently gathered steam, with the DeepSeek-related fears turning out to be overblown. Moreover, chances of a U.S.-China trade deal, the Fed's indication of two rate cuts of 25 basis points each this year and the evaporation of recession worries in the U.S. economy boosted market participants confidence. Here we recommend five AI stocks to invest in for the second half of this year. These stocks have appreciated in the past three months. Each of our picks sports a Zacks Rank #1 (Strong Buy) reflecting near-term price upside potential. You can see the complete list of today's Zacks #1 Rank stocks here. These stocks are: Jabil Inc. JBL, Twilio Inc. TWLO, UiPath Inc. PATH, Intuit Inc. INTU and Dell Technologies Inc. DELL. The recent AI turmoil is nothing but profit-taking, especially on the part of institutional investors. Stock markets consist of bull and bear operators. As bulls fly high, bears wait quietly for a suitable time and some factors necessary for profit-booking so that they can reenter the market at a reasonably low level. Stock prices of several AI companies have skyrocketed 100-500% in the last two years. Therefore, the speculation of a market correction was ripe from the beginning of 2025. Nevertheless, the AI space remains rock solid supported by an extremely bullish demand scenario. Four of the 'magnificent 7' stocks have decided to invest a massive $325 billion in 2025 as capital expenditure for AI-infrastructure development. This marks a significant 46% year-over-year increase in capital spending on the AI ecosystem. This huge spending on AI infrastructure will dramatically change the world over the next five years in fields like hyperscale automation, robotics, healthcare, energy, materials, financials and cybersecurity. Research firm Oppenheimer estimated that the total addressable global sovereign AI market could be a massive $1.5 trillion. The chart below shows the price performance of our five picks in the past three months. Image Source: Zacks Investment Research Jabil has been benefiting immensely from healthy momentum in capital equipment, AI-powered data center infrastructure, cloud, and digital commerce business verticals. Its focus on end-market and product diversification is a key catalyst. Jabil's target that 'no product or product family should be greater than 5% operating income or cash flows in any fiscal year' is commendable. JBL's high free cash flow indicates efficient financial management practices, optimum utilization of assets, and improved operational efficiency. Massive application of generative AI is set to drastically increase the efficiency of JBL's automated optical inspection machines for automation industry. A large-scale portfolio of business sectors offers JBL a high degree of resiliency during times of macroeconomic and geopolitical disruption. Jabil has an expected revenue and earnings growth rate of 5.9% and 18.5%, respectively, for the next year (ending August 2026). The Zacks Consensus Estimate for next-year earnings has improved 9% over the last 30 days. Twilio is a leading provider of cloud communications Platform-as-a-Service in the United States and internationally. TWLO is focusing on generative AI offerings to tap the growing opportunities in this space. In this regard, TWLO launched Customer AI technology in June 2023, which powerfully combines customer engagement platform data, generative and predictive AI, and large language models (LLMs) to unlock stronger customer relationships for brands. TWLO is integrating generative AI capabilities across its platform and every customer touchpoint. The company believes that by training LLMs for customers with their data inside its Segment customer data platform, Twilio will be able to help customers enter the AI race multiple steps ahead of their peers. TWLO has also partnered with Alphabet Inc. (GOOGL) for Google Cloud to integrate generative AI into the Twilio Flex customer engagement platform. Twilio's initiative to integrate generative and predictive AI technology across its platform is likely to boost its revenue growth over the long run. Twilio enables companies to create personalized, customer-aware experiences powered by OpenAI. Through this integration, Twilio customers will be able to use OpenAI's GPT-4 model to power new generative capabilities in Twilio Engage, its multichannel marketing solution built on the Segment Customer Data Platform. Twilio has an expected revenue and earnings growth rate of 7.9% and 22.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 6.9% over the last 60 days. UiPath provides an end-to-end automation platform that offers a range of robotic process automation solutions primarily in the United States, Romania, the United Kingdom, the Netherlands, and internationally. PATH offers a suite of interrelated software to build, manage, run, engage, measure, and govern automation within the organization. The PATH platform's embedded AI (artificial intelligence), ML (machine language), and NLP (Natural Language Processing) capabilities improve decisioning and information processing. PATH introduced new generative AI features, including specialized LLMs (Large Language Model) such as DocPATH and CommPATH, and Context Grounding, to enhance automated AI models for specific business needs. UiPath has an expected revenue and earnings growth rate of 8.5% and 5.7%, respectively, for the current year (ending January 2026). The Zacks Consensus Estimate for current-year earnings has improved 7.7% over the last 30 days. Intuit has been benefiting from steady revenues from the Online Ecosystem and Desktop business segments. INTU's strong momentum in Online Services revenues is driven by the solid performance of Mailchimp, payroll and Money, which includes payments, capital and bill pay. Intuit's generative AI-powered "Intuit Assist," provides financial assistant, enabling personalized insights and recommendations, integrated into products like TurboTax, Credit Karma, QuickBooks, and Mailchimp, aiming to fuel small business and personal financial success. INTU's Credit Karma business is benefiting from strength in Credit Karma Money, credit cards, auto insurance and personal loans. INTU's strategy of shifting its business to a cloud-based subscription model will help generate stable revenues over the long run. Cloud is a flourishing part of the technology space and has been gaining momentum in recent years. Intuit has an expected revenue and earnings growth rate of 11.7% and 13.7%, respectively, for the next year (ending July 2026). The Zacks Consensus Estimate for next-year earnings has improved 0.2% over the last 30 days. Dell Technologies has been benefiting from strong demand for AI servers driven by ongoing digital transformation and heightened interest in generative AI applications. In the last reported quarter, DELL secured $12.1 billion in AI server orders, surpassing shipments and building a strong backlog. DELL's PowerEdge XE9680L AI-optimized server is very much in demand. Strong enterprise demand for AI-optimized servers is aiding the company. A robust partner base that includes the likes of NVIDIA, Google and Microsoft has been a major growth driver. DELL is expanding its cloud services through its infrastructure solutions and rich partner base that provides essential hardware and services that support cloud environments. Through its APEX platform, DELL provides multi-cloud solutions and advanced AI infrastructure, which have become key highlights of its offerings. Dell Technologies has an expected revenue and earnings growth rate of 8.7% and 16%, respectively, for the current year (ending January 2026). The Zacks Consensus Estimate for current-year earnings has improved 0.1% over the last seven days. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Dell Technologies Inc. (DELL) : Free Stock Analysis Report Intuit Inc. (INTU) : Free Stock Analysis Report Jabil, Inc. (JBL) : Free Stock Analysis Report UiPath, Inc. (PATH) : Free Stock Analysis Report Twilio Inc. (TWLO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
25-06-2025
- Business
- Yahoo
Twilio vs. Bandwidth: Which CPaaS Stock Is the Better Buy Right Now?
Twilio Inc. TWLO and Bandwidth Inc. BAND are two major names in the U.S. Communications Platform as a Service (CPaaS) market. Both help businesses and developers build apps for messaging, voice and emergency services using application programming interfaces (APIs). With the growing shift to cloud-based communications and artificial intelligence (AI)-driven solutions, the big question for investors is: Which of these CPaaS players offers a more compelling investment opportunity today? Let's break down their fundamentals, growth prospects and valuations to find out. Twilio remains the leader in customer communications, offering tools that help businesses connect with customers in real time and at scale. The company's focus on AI-powered products like Conversation Relay and Generative Custom Operators allows businesses to automate customer interactions, improve security and get smarter insights. This focus on AI is helping Twilio's clients work more efficiently and save costs. Twilio Segment, TWLO's customer data platform, is another growth driver. It allows businesses to bring together data from different sources to run targeted marketing campaigns that boost loyalty and sales. As AI adoption rises, Twilio's ability to combine communication with data gives it a real advantage. On the financial front, Twilio has made solid progress. In the first quarter of 2025, non-GAAP earnings per share jumped 42.5% on 12% revenue growth due to better cost control and efficiency. Twilio Inc. price-consensus-eps-surprise-chart | Twilio Inc. Quote Twilio's financial health looks strong, with $2.45 billion in cash and $991 million in long-term debt. It has been returning capital to shareholders aggressively by repurchasing stocks worth $2.3 billion in 2024 alone. In January 2025, Twilio authorized a $2 billion share buyback program, signaling confidence in its long-term prospects. During the first quarter of 2025, it repurchased shares worth $126.3 million. Bandwidth has built a respectable position in cloud communications but at a smaller scale than Twilio. In the first quarter of 2025, Bandwidth saw its non-GAAP earnings per share rise 33.3% on 7% revenue growth. Its Enterprise Voice business is the star performer, with the growing adoption of its Maestro and AI Bridge platforms. These help businesses modernize communications and integrate AI voice tools for better efficiency. Bandwidth Inc. price-consensus-eps-surprise-chart | Bandwidth Inc. Quote From a portfolio strength and market positioning view, Bandwidth's mix of Enterprise Voice, Global Voice Plans and Programmable Messaging provides a broad service offering. Its global network helps ensure reliable, low-latency service for demanding use cases like AI-powered voice applications. However, challenges remain. Messaging growth has been slow and could face more pressure if retail or marketing spending slows. The heavy reliance on Enterprise Voice for growth creates a concentration risk, and while Bandwidth's AI offerings show promise, it may take time before they drive significant revenues. Bandwidth's debt is another concern. As of March 31, 2025, the company had just $42 million in cash compared to $468 million in long-term liabilities. This debt load could limit its ability to invest or manage through tough periods. Twilio seems better positioned for growth. The Zacks Consensus Estimate for TWLO's 2025 revenues and EPS implies year-over-year growth of 7.9% and 22.3%, respectively. The consensus mark for BAND's 2025 revenues and EPS indicates a year-over-year increase of 0.3% and 14.2%, respectively. On the valuation front, Twilio trades at 3.61 times forward sales compared to 0.53 times for Bandwidth. While TWLO looks more expensive, its higher growth momentum justifies the premium. BAND's lower valuation reflects its risks, including slowing messaging growth, macroeconomic headwinds and a high debt level. Image Source: Zacks Investment Research Year to date, Twilio stock has risen 9%, while Bandwidth shares have fallen 17.3%. This difference shows how investors are weighing the risks and rewards of each company. Image Source: Zacks Investment Research Both companies offer ways to benefit from the shift to cloud communications and AI. However, Twilio's scale, product diversity, stronger growth outlook and solid balance sheet give it a clear edge. For investors looking for a more reliable and faster-growing player in CPaaS, Twilio stands out as the smarter choice right now. Currently, TWLO sports a Zacks Rank #1 (Strong Buy), making the stock a must-pick compared to Bandwidth, which has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Twilio Inc. (TWLO) : Free Stock Analysis Report Bandwidth Inc. (BAND) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
09-06-2025
- Business
- Yahoo
KeyBanc Initiates Coverage Of Twilio (TWLO) with Overweight Rating
Twilio Inc. (NYSE:TWLO) is one of the 10 tech stocks on Wall Street's radar right now. On June 6, KeyBanc initiated coverage of Twilio Inc. (NYSE:TWLO) with a $146 price target and an Overweight rating as part of the firm's broader look at enterprise software stocks. The firm noted that the company's recent momentum could continue, which could be driven by a sharper focus on its main products and improvements in its go-to-market execution. Over the last month, Twilio's (NYSE:TWLO) stock has gained nearly 15.7%. A software developer in front of a monitor, coding to build the latest internet content & information. Earlier on May 14, Baird analyst William Power reaffirmed a Buy rating on Twilio (NYSE:TWLO) with a $130 price target. The firm had previously cut the price target for the company in April from $160 to $130. Power's view shows confidence in the company's progress in conversational AI and its collaboration with Microsoft. Moreover, tools like ConversationRelay and its integration with Segment are seen as Twilio's (NYSE:TWLO) main strengths. The company's platform upgrades, including new AI and customer data features, signal strong innovation. Twilio (NYSE:TWLO) provides a platform that helps businesses manage customer interactions through messaging, voice, email, and user verification. Furthermore, the company offers tools to personalize experiences using real-time data and AI features. While we acknowledge the potential of TWLO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
05-06-2025
- Business
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Twilio Soars 19% in a Month: Should Investors Buy the Stock Now?
Twilio Inc. TWLO has delivered a solid 18.8% gain over the past month. This performance easily beats the Zacks Internet Software industry, which rose 15.8% in the same period. The stock has also moved ahead of big cloud communication providers, including Inc. AMZN, Cisco Systems, Inc. CSCO and Microsoft Corporation MSFT. Shares of Amazon, Cisco and Microsoft have risen 12%, 8.7% and 7.1%, respectively. This outperformance shows investors are increasingly confident about Twilio's long-term story, even during a volatile market shaped by trade conflicts and geopolitical risks. We believe this momentum is grounded in strong fundamentals, and TWLO's long-term outlook justifies a buy position for now. Image Source: Zacks Investment Research Twilio maintains its leadership position in customer engagement by enabling real-time, personalized interactions for businesses globally. Its artificial intelligence (AI)-powered solutions play a key role in driving efficiency and customer satisfaction. Twilio Verify and Voice Intelligence leverage AI to automate and optimize customer interactions, delivering better security and valuable insights. Twilio Segment, a rapidly growing customer data platform, is another growth driver. By unifying customer data from multiple touchpoints, Segment empowers businesses to run highly targeted, data-driven marketing campaigns, boosting retention and sales. As enterprises increasingly adopt AI to streamline operations and enhance customer experiences, Twilio's data-rich, AI-driven platforms will continue to benefit from this trend. The company's strategic positioning in the growing customer engagement market makes the stock worth buying despite near-term challenges. Twilio's application programming interface (API)-first approach differentiates it from larger tech rivals such as Microsoft, Amazon and Cisco. While these giants offer standardized, bundled solutions, Twilio's customizable APIs enable businesses to create tailor-made communication experiences, giving them a competitive advantage. This flexibility appeals to a wide range of customers, from startups to large enterprises, enhancing customer stickiness and loyalty. Furthermore, Twilio's global reach across 180+ countries extends its market presence beyond many regional competitors. Its deep integration across messaging, voice, email and video makes it the go-to provider for comprehensive customer engagement solutions, strengthening its long-term growth prospects. Twilio's latest financial results for the first quarter of 2025 demonstrate the company's resilient business model amid ongoing macroeconomic uncertainties. In the first quarter, the company delivered nearly 43% year-over-year EPS growth, with revenues climbing 12%. Twilio Inc. price-consensus-eps-surprise-chart | Twilio Inc. Quote Twilio's dollar-based net expansion rate improved to 107%, up from 106% in the previous quarter and 102% in the year-ago quarter, reflecting strong customer retention and upselling momentum. The company's active customer accounts grew to more than 335,000 as of March 31, 2025 compared to 325,000 in the previous quarter, highlighting its continued customer acquisition. Twilio's balance sheet remains solid, with $2.45 billion in cash, cash equivalents and short-term investments as of Dec. 31, 2024. Its free cash flow generation of $178 million in the first quarter, along with $191 million in operating cash flow, demonstrates its financial stability and ability to fund growth initiatives. Twilio's strong cash flow has helped it return cash through regular quarterly dividend payments and share repurchases. In 2024, Twilio repurchased $2.33 billion worth of shares, completing its $3 billion buyback program. In the first quarter of 2025, it bought back shares worth $126 million under the ongoing share repurchase authorization of $2 billion. Its share buyback strategy reflects management's confidence in the company's long-term value. Despite its strong growth, Twilio stock still looks reasonably priced. It trades at a forward 12-month price-to-sales (P/S) multiple of 3.69X, which is lower than the industry average of 5.66. This discount adds to the appeal for long-term investors. Image Source: Zacks Investment Research Compared with its competitors in the cloud communication space, Twilio trades at a discounted valuation multiple against Microsoft and Cisco, while at a premium against Amazon. At present, Microsoft, Cisco and Amazon have a P/S multiple of 11.09X, 4.34X and 3.05X, respectively. Twilio's strong performance demonstrates real progress in its business fundamentals, rising customer engagement, improving margins and a smart capital return program. With its AI-driven platform, flexible API-first strategy and compelling valuation, now is a good time to invest in TWLO stock. Twilio carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Inc. (AMZN) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Twilio Inc. (TWLO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
19-05-2025
- Business
- Yahoo
Morgan Stanley Analyst Maintains Buy Rating on Twilio (TWLO) Stock, Keeps $117 PT
We recently published a list of . In this article, we are going to take a look at where Twilio Inc. (NYSE:TWLO) stands against other AI stocks on Wall Street's radar. Days after the Biden-era rule on AI chips export was rescinded, a bipartisan group of eight U.S. lawmakers has now introduced a bill requiring makers of artificial intelligence chips to include technology that verifies the location of their chips before exporting them. Introduced in the U.S. House of Representatives, the Chip Security Act will aim to address reports of U.S. export-controlled AI chips being smuggled into China. The bill comes shortly after US President Donald Trump began his tour of the Middle East this week, announcing several deals that will send AI chips to countries in the Middle East. This has been despite growing opposition from some inside the US government. READ NEXT: and 'In order for the United States to maintain our technological advantage, we must employ safeguards to help ensure export controls are not being circumvented, allowing these advanced AI chips to fall into the hands of nefarious actors.' For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q4 2024. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A software developer in front of a monitor, coding to build the latest internet content & Inc. (NYSE:TWLO) is a leading cloud communications platform-as-a-service (CPaaS) company. On May 15, Analyst Meta Marshall from Morgan Stanley maintained a 'Buy' rating on the stock with a $117.00 price target. Twilio has been advancing strategically and demonstrates significant growth potential, which has led to the buy rating. In particular, Twilio's platform stood out at its recent Signal event, demonstrating how it can enhance B2C relationships through contextual data crucial for cross-selling opportunities. Even though financial details weren't shared at the event, the company made it clear that Twilio is committed to simplifying its platform and improving its value proposition. The company has also announced a multi-year partnership with Microsoft to develop conversational AI solutions on Azure AI Foundry. This announcement will likely help to grow its reach. Overall, TWLO ranks 9th on our list of AI stocks on Wall Street's radar. While we acknowledge the potential of TWLO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TWLO and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: and . Disclosure: None. This article is originally published at . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
