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Investing.com - Truist Securities raised its price target on Block Inc. (NYSE:SQ) to $70.00 from $65.00 on Thursday, while maintaining a Sell rating on the stock. According to InvestingPro data, Block currently trades at $74.18 with a market capitalization of $45.17 billion, and analysts’ price targets range from $35 to $104.
The price target increase follows Block’s second-quarter earnings report, with Truist highlighting the company’s short-term consumer financing product, Cash App Borrow, as the primary driver of Block’s recent top-line growth acceleration. The company has achieved modest revenue growth of 1.41% over the last twelve months, while maintaining a P/E ratio of 15.42.
Despite the higher price target, Truist remains cautious on Block shares, expressing concern that investors are not fully considering the impact of credit losses and working capital requirements needed to sustain robust growth in the company’s lending products. InvestingPro analysis reveals that Block maintains a "GOOD" overall financial health score and notably achieved a perfect Piotroski Score of 9, indicating strong operational efficiency. Get access to 10+ additional exclusive ProTips and comprehensive analysis with InvestingPro.
Truist’s analysis places its 2026 adjusted earnings per share estimates approximately 15% below consensus Street expectations, reflecting its more conservative outlook on Block’s lending business performance.
The firm indicated a preference for Block competitors, specifically recommending Fiserv (NYSE:FI) and Toast (NYSE:TOST), both of which Truist rates as Buy.
In other recent news, Block Inc. reported significant developments impacting its financial outlook. The company’s second-quarter performance showed a 14% increase in gross profit, driven largely by its expanding lending business, which now constitutes about 22% of Block’s gross profit. This segment alone accounted for over 50% of the gross profit growth in the quarter. Analysts at Bernstein SocGen Group have reiterated an Outperform rating on Block, maintaining a price target of $95, emphasizing the importance of the lending business. Meanwhile, Jefferies adjusted its price target for Block to $90, citing cautious investor sentiment despite positive momentum in Square’s U.S. gross payment volume. Mizuho (NYSE:MFG) also raised its price target to $88, highlighting improvements in Square’s point-of-sale volumes and market share. Additionally, Block unveiled a new modular bitcoin mining system, Proto Rig, and a fleet management software, Proto Fleet, at an event in Georgia. Core Scientific has been identified as the first customer for these innovations, marking a step forward in Block’s technological advancements.
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