Twilio (TWLO) - Get Report shares were rising Tuesday after Needham analyst Richard Valera initiated coverage of the San Francisco cloud-communications-platform provider with a buy rating.

The firm set a price target of $165 on the stock, a 17% upside from its Monday closing price of $140.71, as Valera views Twilio as the leader in the communications-platform-as-a-service space. Shares were rising 2.3% to $143.97 on Tuesday.

"By leveraging its early market position, a highly efficient developer-led sales model and growing array of differentiated, higher-level functions on its platform. TWLO has delivered exceptional organic growth. As well, the company's recent move up the stack into the application space with its Flex contact center adds another, meaningful growth driver to its business," Valera wrote. 

Valera said Twilio has generated an "exceptional" organic growth rate of more than 60% with no signs of slowing due to its ability to integrate into different types of digital communications within apps like Uber and Airbnb. 

The firm also liked Twilio's efficient sales model and the higher-level functions of its communications platform. 

Twilio is a holding in Jim Cramer's Action Alerts PLUS charitable trust