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Investing.com - KeyBanc raised its price target on Block Inc. (NYSE:XYZ) to $100.00 from $60.00 on Friday, while maintaining an Overweight rating on the stock following the company’s second-quarter earnings report. The new target aligns with the broader analyst sentiment, as InvestingPro data shows analyst targets ranging from $35 to $105, with 9 analysts recently revising earnings expectations upward.
Block reported second-quarter results that exceeded expectations for both gross profit and adjusted operating income, prompting the company to raise its fiscal year 2025 guidance beyond the second-quarter upside. The company maintains healthy financials with a gross profit margin of 38.2% and strong liquidity, as evidenced by a current ratio of 2.27.
The company’s management indicated a sequential acceleration in gross profit for the second half of the year, though third-quarter margin guidance fell below KeyBanc’s expectations due to the ramping of Borrow services and increased marketing spend.
KeyBanc cited recent momentum in Block’s business model and progress in Square and Cash App product priorities as reasons for its optimistic outlook. CEO Jack Dorsey stated that Block is back in "growth mode" and "back on offense."
The new $100 price target is based on 18.4x fiscal year 2025 and 14.5x fiscal year 2026 adjusted EBITDA multiples, reflecting the better-than-expected second-quarter results and evidence of successful product and sales initiatives in the Seller ecosystem.
In other recent news, Block Inc. reported its second quarter 2025 earnings, revealing a mixed financial performance. The company missed analyst expectations with earnings per share of $0.62, falling short of the projected $0.67. Revenue also came in below expectations at $6.05 billion, compared to the anticipated $6.27 billion. Despite these misses, strong operational updates and future growth prospects have kept investor interest alive. Morgan Stanley (NYSE:MS) adjusted its price target for Block to $77 from $73, maintaining an Equalweight rating due to a revised valuation model. Meanwhile, Piper Sandler raised its price target to $58 from $50, retaining an Underweight rating, following Block’s updated fiscal year 2025 guidance. These developments reflect the varied analyst perspectives on Block’s performance and future outlook.
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