Index reshuffle puts Twilio in focus
Twilio (TWLO) just completed a significant index shuffle, joining the S&P 500 and several related benchmarks while exiting multiple mid and small cap indices in early October 2026.
Short term traders just saw some profit taking, with the 1 day share price return down 2.6% and the 7 day share price return down 6.6% after the S&P 500 addition rally. Twilio still carries strong momentum with a 30 day share price return of 17.2%, a year to date share price gain of 97.3% and a 1 year total shareholder return of 139.4%, even though the 5 year total shareholder return is down 21.0%.
Scan how Twilio’s S&P 500 move compares with other fast movers in its space by sizing up the 29 high quality undervalued stocks.
Twilio has sprinted into the S&P 500, then given back a slice of those gains. Is that post-index pullback already a second chance, or does waiting on the sidelines make more sense when you look at the current valuation setup?
Most Popular Narrative: 4% Overvalued
Twilio last closed at $273, which sits a little above the most widely followed fair value estimate of $263.04 that applies a 9.3% discount rate and assumes quite demanding earnings and margin outcomes.
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), expanding the company's addressable market and contributing to higher-margin revenue growth, which in turn supports future revenue and net margin expansion.
See why 77 investors see Twilio as 4% overvalued.
Result: Fair Value of $263.04 (OVERVALUED)
Still, Twilio’s story could change quickly if low margin messaging continues to weigh on profits, or if AI driven customers shift to in house or rival platforms.
Find out about the key risks to this Twilio narrative.
Next Steps
Twilio’s setup is not one sided, with investors flagging both meaningful risks and some encouraging bright spots in the current story. If you want to move quickly instead of just watching the consensus, weigh both angles for yourself by going through the 1 key reward and 4 important warning signs.
Looking for more investment ideas beyond Twilio?
If Twilio has your attention but you do not want your portfolio leaning on one story, you could broaden your watchlist with a few focused stock shortlists.
- Target steadier compounding potential by reviewing a 8 dividend fortresses that prioritises income strength with higher yields.
- Hunt for quality at a sensible entry point by scanning the 20 high quality undiscovered gems that rarely appear on headline lists.
- Dial down portfolio risk by filtering for a 31 resilient stocks with low risk scores that concentrates on resilience and balance sheet strength.
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.
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