JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
On Monday, Canaccord Genuity adjusted its price target for Block Inc. (NYSE: SQ) shares, reducing it to $100 from the previous $120, while maintaining a Buy rating. The adjustment follows Block’s recent financial update, where the company’s fourth-quarter gross profit met guidance, but its adjusted earnings per share (EPS) fell short of market expectations. InvestingPro analysis suggests Block is currently undervalued, despite the stock’s sharp 18.6% decline over the past week.
Block’s Q1 and full-year 2025 gross profit forecasts were also below consensus expectations. The first quarter is anticipated to be the weakest in terms of gross profit, with the company expecting an uptick throughout the remainder of the year. With a robust revenue growth of 10.06% and a healthy gross profit margin of 37.14%, Block’s management is aiming to capture more market share, committing to an increased marketing budget after seeing positive returns on investment.
The company is also investing in its go-to-market (GTM) team within its seller business and promoting the adoption of its new orders platform. Despite these investments, Block is planning for a 240 basis point increase in adjusted operating margins and aims to meet the Rule of 40—a financial metric indicating strong company performance—by the end of 2025.
With 5 million direct deposit users currently on its Cash App platform, Block has identified driving direct deposits as a key focus for the year. The company’s strategic emphasis is on reinforcing the elements of its business that have shown success, particularly as it navigates through a softer-than-expected profit outlook. According to InvestingPro, Block maintains strong financial health with a current ratio of 2.33, indicating robust liquidity to support its growth initiatives. For deeper insights into Block’s valuation and growth potential, including 12 additional exclusive ProTips, visit InvestingPro’s comprehensive research report.
In other recent news, Block Inc. has seen several adjustments to its stock ratings and price targets from various analysts. Mizuho (NYSE:MFG) Securities has reduced its price target for Block Inc. from $110 to $86, maintaining an Outperform rating. The firm highlights concerns such as stagnation in Monthly Active Users for Cash App and increased consumer receivable losses, although they remain optimistic about the company’s efforts to expand its user base and enhance monetization. BMO Capital Markets upgraded Block’s stock rating to Outperform while lowering the price target from $100 to $89. They see the recent sell-off as an attractive entry point and note more balanced market sentiment around the company.
UBS has slightly adjusted its price target for Block Inc. from $98 to $97, maintaining a Buy rating. They anticipate growth in gross profit for Square and Cash App services throughout 2025. TD Cowen reiterated a Buy rating with a $115 price target, expressing confidence in Block’s long-term growth despite a slower start to the year and some investor skepticism. Lastly, RBC Capital Markets maintained an Outperform rating with a $110 price target, emphasizing product innovation and market expansion as key elements for Block’s performance in fiscal year 2025. These developments reflect a mix of cautious optimism and strategic focus on growth initiatives for Block Inc.
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