Block
Analysts are now assessing the earnings and reviewing their ratings on Block stock.
The Block Analyst: JPMorgan analyst Tien-tsin Huang, CFA has an Overweight rating on the stock with a price target of $90 a share. This implies an upside of 32.45% from the price level of $67.96 a share.
The Block Thesis: Huang sees strong prospects for Block post-Q4 earnings. The company swiftly cut costs, beating 4Q and FY24 EBITDA expectations, achieving a 22% gross profit growth with a 28% margin. Cash App thrived, growing 25% in gross profit, targeting the primary bank role for households earning up to $150k/year.
Block's FY24 outlook aims for 15%+ gross profit growth, aligning with investor expectations. Huang, confident in Block's future, raises the FY24 EBITDA estimate by 6%.
Huang emphasized Cash App's growth roadmap, focusing on user banking and expanding into a next-gen social bank. "The overall momentum within Cash App is impressive, and we'll be watching for data points as Cash App closes product gap," the analyst said.
Block also experiments with innovative strategies like a "pay-as-you-go" model and bundled restaurant offerings, another potential catalyst for the company.
Huang's assessment highlighted Block's adept cost management, Cash App's robust growth, a positive outlook, and ongoing innovation. Block, with its favorable valuation, stands as a promising player in the evolving fintech sector.
SQ Price Action: Block stock was up 21.34% to $82.46 at the time of publication Friday.