The stock market’s response to the company’s revenue does not always reflect what is in its earnings report. In some cases, investors are expecting too much and will move on to the exit after the business is over. At other times, the reported income confirms the recent price movement of a stock and shares continue to move up and down.

This is the most recent quarter, Twilio (NYSE: TWLO) The stock was the victim of the first statement above and EPAM systems (NYSE ፡ EPAM) Shows the final statement.

Overall, both companies reported strong results, but the market response was very different. Regardless of the initial market response to the income report, let’s see why these two stocks can be bought.

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1. Twilio

Communicating with customers is important for a business but can also be complicated. Twilio simplifies the process by providing a Communication Application Programming Interface (APIS) that allows employees with less code experience to perform complex communication tasks. It also has an educational video game to help train these new programmers. Twilio can help communicate in a variety of ways, including text, email, video, and program audio. Its widespread use has made it acceptable in many industries.

No matter how useful the platform is, Twilio has experienced significant stock price volatility due to high reviews. Twilio has seen stock prices fall by more than 5% a day for 2021 so far. Twilio shares traded up 17.6% in one day To report another quarter with significant EPS losses by the end of October.

On the bright side, Twilio’s third-quarter earnings continued to grow by 65 percent, while organic revenues increased by 38 percent. In addition, the net expansion rate has remained above 130%, which means that the current customer base is up 30% higher than the previous quarter.

As it moves forward, the leadership says it is confident that it will provide 30% organic revenue growth every three years. If that were true, Twilio’s revenue for the third quarter of 2024 would more than double to $ 1.3 billion. Assuming all segments follow this growth trend, the annual revenue of about $ 5 billion translates to the P / S ratio of 11. This is consistent Number of shares, Something Twilio did not do well in caring. Investors should be concerned that their investments have been steadily declining as the stock market has grown by about 15 percent over the past two years.

If you can expect a 30% growth in management, consider investing in existing stocks. With Twilio’s stock price down about a 35-week high of about 35%, the market is offering the opportunity to buy these shares on sale.

2. EPAM systems

Many businesses have a vision of creating game-changing ideas. Few have the capacity and knowledge to bring the concept to an end. EPAM Systems helps bring ideas to fruition by supporting product development, digital platform engineering and digital product design. Custom software is one of the world’s largest manufacturers and can handle everything from design, engineering, operation and customization to its customers. Qualifications and offerings vary across industries, including financial services, travel, software, business information and life sciences. Led by the founder of Arkadi Dobkin, EPAM is an international company with roots in both the United States and Belarus.

EPAM Systems closed. Third quarter With 52% revenue growth, it is led by the travel segment (79% growth per year). This growth was consistent across the region.

Region Third Quarter Revenue (YOY)
North America 52%
Europe 51%
Free Government Commonwealth 50%
Asia-Pacific 60%

Source of information EPAM Systems Yoi = over a year.

EPAM earns 40% of its revenue outside of North America. EPAM’s wide reach around the world and in industries can help withstand any local economic downturn.

Investors have made huge profits with EPAM. Shares have grown by about 87% in 2021 and are in the top 10 in the last five years. Accelerating revenue growth in all sectors and seeing continued performance has made investors expect the same.

One measure to consider is the value of the company. EPAM is a for-profit company and has been around for some time. The P / E ratio of around 40 in 2020 has increased to 100 today. This high estimate should not slip into EPAM performance, otherwise the stock may stumble.

As a growing number of companies move into the digital-first world, they need EPAM knowledge to create solutions. As a result, EPAM will continue to grow and provide long-term stock market performance.

Take an investor

Both companies are experiencing a tailspin that must continue to be favored by them. Strong revenue growth could push both EPAM and Twilio stocks to better grow the market. There is a risk of inflation in both investments, but significant growth may reduce this risk. As both companies are growing rapidly, only high-inflation investors should invest in these two. Allowing EPAM and Twilio to stay in the portfolio is a great option for current and future shareholders.

This article represents the author’s opinion, which does not agree with the “official” decision of the Motley Ful Premium Advisory Service. We are Motoli! Asking for investment opportunities – even our own – can help us all think critically about investing and make decisions that will make us smarter.