Is Twilio, Inc. overvalued or undervalued?

As of 7 August 2025, the valuation grade for Twilio, Inc. has moved from risky to attractive, indicating a significant improvement in its perceived value. The company appears to be undervalued, particularly when considering its Price to Book Value of 2.32, EV to Sales ratio of 3.74, and an EV to EBITDA of 70.23, which suggest that despite its losses, the market may not fully reflect its potential growth. In comparison to its peers, Twilio's valuation metrics stand out, especially against Unity Software, Inc., which has a negative P/E ratio of -49.32, and Gen Digital Inc., which has a more favorable EV to EBITDA of 12.62. While Twilio shows an attractive valuation, its recent stock performance has been mixed; it has returned 79.14% over the past year compared to the S&P 500's 17.14%, but it has significantly underperformed over the longer term, with a 5-year return of -51.92% against the S&P's 96.61%.