Financial technology company Block (NYSE:SQ) will release its fourth-quarter financial results on Thursday, February 23. Block could deliver solid sales and earnings due to the momentum in the Cash App, new customer wins, strength in retention rate, and focus on profitability.
But before jumping to any conclusion, let’s look at what analysts expect from Block in Q4.
Analysts expect Block to post sales of $4.62 billion in Q4 compared to $4.08 billion in the prior-year quarter. TipRanks’ data shows that SQ surpassed analysts’ revenue estimates 75% of the time in the past 12 months. In comparison, the overall industry average stands at 65.29%.
Wall Street expects Block to report earnings of $0.30 a share compared to $0.27 in the prior year period. Our data shows that SQ exceeded Street’s expectations 75% of the time in the last 12 months. At the same time, the overall industry beat the EPS estimate 62.29% of the time.
Overall, the strong engagement across all of its products in the Cash App ecosystem and higher transaction-based revenues will likely support its financials. However, growing competitive activity and macro weakness, especially in the UK, could pose challenges.
Mizuho Securities analyst Dan Dolev remains impressed with the company’s growing volumes. However, he believes that “increasing competitive pressures from next-gen POS systems” have started to take a toll on its performance and market share. Dolev recommends a Hold on SQ stock.
What is the Price Target for Block Stock?
Block stock has gained over 14% year-to-date in 2023. Meanwhile, analysts’ average price target of $89.46 implies 24.34% upside potential. Further, 10 analysts have a Buy recommendation on Block stock, and four recommended a Sell. Overall, it has a Moderate Buy consensus rating.
