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Block Inc Class A SQ

Morningstar Rating
$64.31 +0.97 (1.53%)
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Company Report

Block Earnings: Dorsey Lays Out Some Financial Targets

We think third-quarter results for Block were solid, but not overly impressive. We are more encouraged by management’s comments and its willingness to lay out some longer-term financial targets. While CEO Jack Dorsey has talked about greater discipline when it comes to profitability, we’ve seen little actual progress and we like that the company is now providing discrete profitability targets. We will maintain our $83 fair value estimate for the narrow-moat company. We see shares as materially undervalued but would stress our Morningstar Uncertainty Rating of Very High.

Price vs Fair Value

SQ is trading at a 24% discount.
Price
$63.34
Fair Value
$48.00
Uncertainty
Very High
1-Star Price
$147.77
5-Star Price
$18.70
Economic Moat
Jbnzzxt
Capital Allocation
Rghnphy

Bulls Say, Bears Say

Bulls

The ongoing shift toward electronic payments has created, and will continue to create, room for payments companies to see solid growth without stealing share from each other.

Bears

Square’s focus on micro and small merchants increases its macroeconomic sensitivity.

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News

Trading Information

Previous Close Price
$63.34
Day Range
$63.6265.11
52-Week Range
$38.8584.74
Bid/Ask
$64.31 / $64.32
Market Cap
$39.50 Bil
Volume/Avg
9.3 Mil / 12.9 Mil

Key Statistics

Price/Earnings (Normalized)
40.56
Price/Sales
1.84
Dividend Yield
Dividend Yield (Forward)
Total Yield

Company Profile

Founded in 2009, Block provides payment services to merchants, along with related services. The company also launched Cash App, a person-to-person payment network. In 2022, Square's payment volume was a little over $200 million.
Sector
Technology
Industry
Software - Infrastructure
Stock Style Box
Mid Growth
Total Number of Employees
12,428

Competitors

Valuation

Metric
SQ
GPN
FI
Price/Earnings (Normalized)
40.5611.3417.56
Price/Book Value
2.181.342.59
Price/Sales
1.843.204.24
Price/Cash Flow
35.2710.7013.43
Price/Earnings
SQ
GPN
FI

Financial Strength

Metric
SQ
GPN
FI
Quick Ratio
1.730.490.16
Current Ratio
1.911.091.07
Interest Coverage
2.655.07
Quick Ratio
SQ
GPN
FI

Profitability

Metric
SQ
GPN
FI
Return on Assets (Normalized)
3.14%5.71%5.69%
Return on Equity (Normalized)
5.62%11.99%15.02%
Return on Invested Capital (Normalized)
4.19%7.89%9.83%
Return on Assets
SQ
GPN
FI

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