Jefferies upgrades Twilio to Buy with $160 target on strong cash flow and AI growth.

Jefferies has upgraded Twilio from Hold to Buy, raising its price target from $125 to $160 due to Twilio's strong financial turnaround and AI infrastructure positioning. Twilio reported a 44% increase in free cash flow to $945.4 million in 2025 and Q4 non-GAAP operating income of $255.57 million. The company’s revenue grew 14% to $5.07 billion, with improved customer spending and a recent Moody’s credit rating upgrade. Despite some revenue growth deceleration and competitive pressures, Jefferies sees the stock as undervalued at around $131, expecting continued free cash flow growth and AI-driven expansion.