Block stock price target cut to $70 by BTIG following earnings

On Friday, BTIG analyst Andrew Harte adjusted the price target for Block Inc. (NYSE: SQ), formerly known as Square, to $70 from the previous $110, while keeping a Buy rating on the shares. The revision followed Block’s first-quarter earnings call, which led to an 18% decline in the company’s stock in after-hours trading. According to InvestingPro data, Block’s stock has shown significant volatility, with the price falling 31.19% year-to-date, though current analysis suggests the stock may be undervalued. For detailed valuation insights, investors can access Block’s comprehensive Pro Research Report, one of 1,400+ deep-dive analyses available on InvestingPro. Harte noted a significant slowdown in Cash App activity in March, with its Gross Profit (GP) growing only 9.6%, below the anticipated ~13% by Wall Street analysts.

Block Inc. has also revised its full-year 2025 guidance downwards, with management attributing this change to a macroeconomic softening that exceeded their prior experiences. Despite other fintech firms presenting a more positive outlook, Block’s conservative approach to guidance is expected to raise investor skepticism.

In defense of maintaining a Buy rating, Harte cited several factors that support a favorable valuation of Block’s stock. These include strong first-quarter results from the Square segment, the company’s continued growth projection of approximately 12% for the year, potential for increased product adoption, and the early stages of revenue synergy realization between the Cash App and Square segments.

Block’s stock was trading at approximately $48 per share after hours, which Harte pointed out corresponds to roughly 7 times the projected FY26 Enterprise Value/Earnings Before Interest, Taxes, Depreciation, and Amortization (EV/EBITDA). This valuation was deemed too low by Harte, especially considering the opportunities for increased engagement and user growth within the Cash App and the prospects for more transactions to be processed through Square Financial Services rather than banking partners. Current InvestingPro metrics support this view, with analyst consensus remaining strongly bullish and targets ranging from $35 to $112 per share. The company’s revenue growth of 10.06% and healthy gross profit margin of 37.14% further strengthen the investment case.

In other recent news, Block Inc. reported disappointing first-quarter earnings for 2025, missing both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $0.56, which was below the expected $0.98, and revenue came in at $5.77 billion, falling short of the forecasted $6.21 billion. Despite the earnings miss, Block’s gross profit rose by 9% year-over-year to $2.29 billion, with adjusted EBITDA increasing by 15% to $813 million. JPMorgan analyst Tien-tsin Huang adjusted Block’s price target from $90.00 to $60.00 while maintaining an Overweight rating, reflecting a more conservative stance amidst the earnings shortfall. Block has revised its guidance downward due to a weaker macroeconomic environment but expects gross profit growth to accelerate to 12% for the full year 2025. The company attributes the revenue shortfall to unexpected weaknesses in its Cash App segment, although its Square segment showed slight outperformance. Block’s CEO Jack Dorsey expressed confidence in the company’s strategic initiatives, highlighting potential growth in the latter half of the year. Analysts and investors are keenly awaiting further insights from Block’s leadership at an upcoming conference.

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