Block stock rating reiterated at Outperform by KBW, citing growth inflection

Investing.com - Keefe, Bruyette & Woods (KBW) has reiterated an Outperform rating and $95.00 price target on Block Inc. (NYSE:XYZ), according to a research note released as part of the firm’s August Opportunity (SO:FTCE11B) series.

KBW expressed confidence in Block’s growth trajectory for the remainder of the year, specifically highlighting expectations for a growth inflection across both of the company’s business segments. With a market capitalization of $45.18 billion and a strong current ratio of 1.96, Block demonstrates solid financial health. The firm believes there is "solid potential for upside" to second-half expectations, particularly if the macroeconomic environment remains stable.

The research note recommends investors own Block stock through the end of the year, positioning the payment technology company as an attractive investment opportunity in the current market environment. InvestingPro data reveals a perfect Piotroski Score of 9, indicating exceptional financial strength. Subscribers can access 8 additional exclusive ProTips and comprehensive financial analysis in the Pro Research Report.

KBW identified Block’s upcoming November investor day as a potential catalyst for the stock. The firm expects this event could offer "a compelling growth narrative for 2026 and beyond" that might further support the company’s valuation.

Block Inc., formerly known as Square, operates two main business segments: its seller ecosystem for merchants and its Cash App personal financial services platform, both of which KBW anticipates will demonstrate accelerating growth in the coming months.

In other recent news, Block Inc. reported a 14% increase in gross profit for the second quarter, driven significantly by its expanding lending business, which now accounts for approximately 22% of the company’s gross profit. Truist Securities raised its price target for Block to $70, citing growth in the Cash App Borrow product as a key factor in the company’s recent revenue acceleration. Meanwhile, Jefferies lowered its price target for Block to $90, maintaining a Buy rating but noting cautious investor sentiment despite positive momentum in Square’s U.S. gross payment volume. Bernstein SocGen Group reiterated its Outperform rating and a $95 price target, emphasizing the substantial contribution of Block’s lending business to its gross profit growth. In addition to financial updates, Block unveiled a modular bitcoin mining system named Proto Rig and an open-source fleet management software called Proto Fleet. The announcement was made at Core Scientific’s facility in Dalton, Georgia, where the Proto Rigs are already in use. These developments highlight Block’s strategic focus on both financial technology and cryptocurrency innovation.

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