Intel stock extends gains after report of possible U.S. government stake
On Monday, Piper Sandler updated its analysis of Block Inc. (NYSE: XYZ), reducing the price target on the company’s shares to $85 from the previous $101, while maintaining an Overweight rating. The adjustment follows Block’s fourth-quarter earnings report, which revealed revenues and earnings per share (EPS) that fell short of expectations. Despite this, Block’s adjusted EBITDA of $1.2 billion surpassed consensus estimates. According to InvestingPro analysis, the stock appears undervalued at current levels, with 13 analysts recently revising their earnings expectations downward.
The financial firm’s analyst pointed out that Block’s profitability guidance for fiscal year 2025 aligns with preliminary figures shared in November. This outlook is seen as a positive sign, especially considering the anticipated foreign exchange (FX) headwinds that could affect the full year’s results by an additional 50 basis points. The company’s strong financial position is evidenced by its healthy current ratio of 2.33x and revenue growth of 10% in the last twelve months to $24.1 billion.
Block’s management has expressed optimism about the second half of 2025, particularly for its Cash App product. Expected growth is attributed to the expansion of Cash App Borrow access and the introduction and scaling of Afterpay. Additionally, Square, another service from Block, is projected to expand throughout the year supported by user acquisition and retention initiatives. InvestingPro subscribers can access 10+ additional exclusive insights about Block’s growth potential and financial health, along with comprehensive analysis in the Pro Research Report.
While specifics were not provided, Block’s management plans to hold an investor event in the second half of 2025. The event is anticipated to offer insights into the company’s long-term financial goals and strategic plans. The analyst’s commentary underscores the potential growth opportunities for Block despite the mixed results in the last quarter, with the company maintaining a robust gross profit margin of 37% and strong market position in the financial services industry.
In other recent news, Block Inc. reported financial results that have led to mixed reactions from analysts. Canaccord Genuity cut its price target for Block to $100 from $120, maintaining a Buy rating, after the company’s fourth-quarter gross profit met guidance but its adjusted earnings per share fell short of expectations. Similarly, Mizuho (NYSE:MFG) Securities reduced its price target to $86 from $110, citing stagnation in Monthly Active Users growth for the Cash App as a concern, yet retaining an Outperform rating. BMO Capital Markets upgraded Block’s stock rating to Outperform from Market Perform, despite lowering the price target to $89, indicating a more balanced market sentiment and potential for improved investor sentiment in 2025. UBS also adjusted its price target slightly to $97 from $98, keeping a Buy rating, and noted anticipated growth in gross profit for Block’s Square and Cash App services. Meanwhile, TD Cowen maintained a Buy rating with a $115 price target, acknowledging a slower start to the year but expressing confidence in Block’s growth narrative for the latter half of 2025. Analysts have highlighted Block’s strategic investments in marketing and its go-to-market team as key initiatives to drive future growth. Additionally, the company is focusing on increasing direct deposit users on its Cash App platform, which is seen as a significant growth area.
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