Daily Update - February 16, 2023

Selected highlights of the day

By: Matthew Otto

Twilio made the decision to enact their first share buyback in four years.

Through allocated $500 million and CEO Jeff Lawson’s personal commitment of $10 million worth of stocks, they are confident about returning shareholders value for investment despite layoffs taking place as well. Additionally, there is optimism surrounding the company’s projection that profits from its communication tools could exceed analyst expectations in Q1.

Revenues hit $1.02 billion in 4Q2022 representing a 22% Year-Over-Year gain from 2021’s figures. For 1Q2023 non-GAAP Profit per share outlook is expected to reach between $0.18 – 0$022 on 188 million Non–GAAP weighted average diluted shares outstanding while Revenue (millions) should land at within an estimated range of $995 to $1005 million with 14%-15% Y/Y projected growth.

UBS analyst Taylor McGinnis maintains a a Buy and has raised the price target from $77 to $93.
RBC Capital analyst Rishi Jaluria holds a Sector Perform rating and sets a new price target at $75, raising it from the previous level of $55.
Canaccord Genuity analyst Michael Walkley continues to have a Buy rating with a revised price prediction of $97, up from the previous $88.
Piper Sandler analyst James Fish set an Overweight rating while raising his price forecast from $69 to $83.
Cowen & Co. analyst J. Derrick Wood holds a Market Perform while increasing his price target from $65 to $75.
Needham’s Ryan Koontz keeps an affirming Buy rating and upgrades his respective price forecast from $60 to $88.
Morgan Stanley’s Meta Marshall keeps her outlook Overweight with a $82 price target, up from $64.
Wells Fargo analyst Michael Turrin has rated an Equal Weight and raised the price target from $60 to $70.
Baird analyst William Power adopted a Neutral stance and increased the price projections from $55 to $80.
Bernstein Peter Weed issued a Market Perform rating while increasing the price target range from $58 to $77.
Keybanc Thomas Blakey has an Overweight with a price target of $89 up from $77.

Roku

Reported its fourth quarter financials and the results surpassed some expectations despite a net loss. Specifically, the company’s net loss accounted for $1.70 per share on $867 million in revenue, while Refinitiv estimates had projected a loss of $1.73 per share on $802 million of revenue. CEO Anthony Wood and CFO Steve Louden expressed optimism regarding future performance in their reports to shareholders highlighting strong recovery among sectors in the ad market such as restaurants, travel, consumer packaged goods, and health and wellness firms in the current first quarter. For additional measurements of success moving forward, associated financial goals differ so that the firm forecasts total revenue of about $700 million for this period.

Roku’s platform segment reported sales of $731.3 million and sales for the devices that allow users to access the platform was $135.8 million. Wood and Louden anticipated projected expenditure growth from a high of 40% in their first quarter to reach only single-digit year over year expansion by the fourth quarter of 2023. Despite the effects of broad economic forces on their business, they stated that two fundamental aspects still apply – the secular trend supports their activities, and leveraging scale, participation and development provides an exceptional opportunity for Roku when market conditions ameliorate.

Stephens analyst Nicholas Zangler has reiterated an Overweight rating and a $70 target price.
Susquehanna analyst Shyam Patil maintained a Neutral rating but increased the target price to $75 from $58.
Wedbush Michael Pachter kept an Outperform rating and raised the target price from $75 to $80.
Alan Gould from Loop Capital had Buy rating and raised in target price to $75 from $56.
Rosenblatt’s Barton Crockett held a Neutral rating whilst increasing the target price to $76 up from $44.
Jeffrey Wlodarczak at Pivotal Research despite his Sell rating raised the price target of $40 to $55 .
Needham’s Senior Technology Analyst Laura Martin holds a Buy rating and raised her target price from $65 to $80.
Atlantic Equities analyst Hamilton Faber upgraded Roku from Underweight to Neutral and announced a $76 price target.

Cisco announced its second quarter earnings at the end of January

Revealing that the company posted net income of $2.77 billion, or 67 cents a share. This net income was lower than the figure reported one year prior, $2.97 billion and 71 cents per share respectively. However, adjusting for other factors, earnings increased to 88 cents ( surpassing analyst expectations of 85 cents) due to a 7% revenue growth achieved during the quarter to around $13.59 billion., which exceeded analysts’ forecasts of $13.42 billion.

Considering the successful second quarter performance, Cisco revised its guidance for the current fiscal year in November, forecasting revenue growth between 9% and 10.5%, along with an increase in adjusted earnings per share ranging from $3.73 to $3.78 dollars (up from their initial prediction of between 4.5% and 6.5 % growth and earnings per share from $3.51 to $3.58).

Piper Sandler’s analyst James Fish has a Neutral and a price target that has gone up from $49 to $53.
UBS analyst David Vogt maintains a Neutral outlook and increases his price target from $48 to $51.
Cowen & Co.’s Paul Silverstein keeps an Outperform rating and raised his price target from $61 to $64.
JP Morgan’s Samik Chatterjee set a Neutral rating and he hiked his price target from $54 to $55.
Credit Suisse’s analyst Sami Badri shares an Outperform outlook with a stock forecast rise from $67 to $69.
Rosenblatt’s Mike Genovese recommends a Neutral rating with an increase of his price target from$51 to 53.
Wells Fargo analyst Aaron Rakers maintains an equal weighting while increasing the price target from $52 to $57.
Raymond analyst James’ Simon Leopold provides an outperform rating with a raised target of $59 to $63.
Morgan Stanley’s Meta Marshall also maintains their opinion of an equal weight now with a price target bump up to $55 from an initial forecast of $52.

Shopify’s quarter earnings

Revealed $1.7 billion in revenue, a 26% increase from the quarter prior and ahead of the Street consensus forecast of $1.65 billion. The year saw an 13% Gross Merchandise Volume climb, exceeding whatever expectations analysts had with its prediction of 10% growth. Furthermore, the company posted an adjusted profit of 7 cents per share when experts were expecting a loss of 1 cent per share.

For the fiscal year ending December 31st 2021, Shopify reported itself as performing better than expected with a 21% jump in revenue which totalled $5.6 billion by YE2021. Going ahead into 2022, management expects to match these high metrics with supposed a close to 20% weighted growth (ranging between 17% to 19%, meaning that estimated revenue for the first quarter is predicted to be technically lower than what analysts project for the same interval given their respective evaluation stand at $17 million and 18%.

Canaccord Genuity analyst David Hynes has given Shopify a Hold rating while increasing the price target from $40 to $45.
Goldman Sachs analyst Gabriela Borges has kept her Neutral rating but increased the previous price target of $36 to $40.
Paul Treiber of RBC Capital rated it an Outperform alongside a raised price target going from $55 to $65.
Timothy Chiodo at Credit Suisse set a Neutral rating but upgraded his former price target from $34 to $40.
Baird analyst Colin Sebastian continues on in adherence with his original Outperform for Shopify; independently choosing for an increase in its associated price target jumping up from its past value of $45 heading up to no less than $55.
Wells Fargo analyst Jeff Cantwell is maintaining Shopify with an Overweight rating and raising the company’s price target from $46 to $56.
Piper Sandler analyst Clarke Jeffries has a Neutral rating and raised his price target from $36 to $45.