Block Inc. (SQ:NYE) Analysts rate as Strong Buy, see big upside potential

RBC Royalbank lowers Block Inc.’s target from $147 to $91

Based on the Block Inc. stock forecasts from 33 analysts, the average analyst target price for Block Inc. (sq stock forecast) is USD 160.18 over the next 12 months. Block Inc.’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Block Inc. (sq stock forecast) is Slightly Bullish, which is based on 7 positive signals and 5 negative signals. At the last closing, Block Inc.’s stock price was USD 66.27. Block Inc.’s stock price has changed by +3.04% over the past week, +7.76% over the past month and -71.64% over the last year.

Together with its subsidiaries, Block, Inc. (sq stock forecast) develops technologies that let merchants take card payments and offer a next-day settlement, reporting, and analytics. It provides service in the UK, Ireland, France, Australia, Japan, Canada, and the United States. Prior to December 2021, the business was known as Square, Inc. Its new name is Block, Inc. Block, Inc. is a 2009 incorporation with a San Francisco, California, base of operations.

 

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk-adjusted returns

This stock has performed well, on a risk-adjusted basis, compared to its sector peers (for a hold period of at least 12 months) and is in the top quartile.

Underpriced compared to book value

The stock is trading low compared to its peers on a price-to-book value basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Earnings Growth

This stock has shown top quartile earnings growth in the previous 5 years compared to its sector.

Superior Revenue Growth

This stock has shown top quartile revenue growth in the previous 5 years compared to its sector.

 

What we don’t like:

High volatility

The total returns for this company are volatile and above the median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock.

Overpriced compared to earnings

The stock is trading high compared to its peers on a price-to-earnings basis and is above the sector median.

Overpriced on a cash flow basis

The stock is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.

Highly leveraged

The company is in the bottom half compared to its sector peers on debt to equity and is highly leveraged. However, do check the news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

Overpriced on a free cash flow basis

The stock is trading high compared to its peers on a price-to-free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.