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Uber Problem Just a Bump in the Road for Twilio Inc (TWLO) Stock

By U.S. News & World Report

Shares of cloud platform company Twilio Inc (ticker: TWLO) fell more than 26 percent Wednesday after the company lowered its 2017 guidance. While a guidance cut is never good news for investors, Twilio’s problems can be traced to a single source: the ride-sharing service Uber.

Uber is one of Twilio’s largest customers. In the fourth quarter of 2016, Uber accounted for 17 percent of Twilio’s total revenue. In the first quarter of 2017, Twilio’s Uber revenue fell 25 percent sequentially.

In Twilio’s earnings call, CEO Jeff Lawson said Uber is changing its approach to communication services. “Previously, they’d used our platform to support most of their use cases in the majority of their operating territories. Now, they are optimizing by use case and by geography, resulting in a more active, multi-sourcing program,” Lawson said.

The bottom line for Twilio investors is that Uber’s share of Twilio’s total revenue dropped from 17 percent in the fourth quarter to only 12 percent in this year’s first quarter, and management expects that decline to continue throughout the remainder of 2017. As a result, Twilio management reduced 2017 revenue guidance by $9 million and non-GAAP income estimates by 12 cents per share.

Despite the guidance cut and huge market selloff, there are still plenty of reasons for long-term Twilio investors to be bullish. Even with the loss of Uber’s business, Twilio still topped consensus analyst expectations for revenue in the first quarter. TWLO reported earnings per share of 4 cents on revenue of $87.4 million compared to consensus estimates of 6 cents and $83.6 million, respectively. Even the lower revenue guidance still represents roughly 30 percent year-over-year growth.

[See: Buy and Hold: Be an Investing Expert Like Warren Buffett.]

Oppenheimer analyst Ittai Kidron says Twilio investors shouldn’t get too hung up on the Uber news.

“While the change is disappointing, we believe the risk of a similar impact from other customers is now minimal. Customer metrics validate Twilio’s strong traction and expansion, which should drive sustained growth,” Kidron says.

William Blair analyst Bhavan Suri says Twilio’s stock offers a compelling valuation at current levels.

“We believe Twilio’s valuation is attractive at these levels as the company benefits from favorable industry dynamics… and a strong business model, which provides different growth vectors than the traditional [software-as-a-service] model,” Suri says.

[See: 7 Socially Responsible ETFs for Investors of All Stripes.]

Both William Blair and Oppenheimer maintain “outperform” ratings on TWLO stock.

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Uber Problem Just a Bump in the Road for Twilio Inc (TWLO) Stock originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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