Block (NYSE:SQ) is scheduled to report fourth-quarter 2023 results on February 22. A strong holiday season and a focus on reducing costs might have supported the company’s performance in Q4. It is worth noting that Block’s web traffic increased year-over-year during the quarter, indicating strong demand for its offerings.
Block operates as a financial services and digital payments company. Interestingly, SQ stock has jumped nearly 14.2% in the past three months, outperforming the broader S&P 500 Index (SPX) rally of about 13%.
Encouraging Website Traffic Trend
According to TipRanks’ Website Traffic tool, total visits to squareup.com grew by 25.8% year-over-year in Q4. The company’s website traffic jumped to 170.49 million from 135.57 million in the year-ago quarter.
The rising website traffic indicates that the company might report an upbeat topline performance in the fourth quarter.
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SQ – Q4 Expectations
Wall Street expects Block to report sales of $5.7 billion in Q4, up 22.6% year-over-year. Higher transactions during the holiday season and continued strength in the company’s Cash App are expected to positively impact its revenue growth in the fourth quarter.
Turning to earnings expectations, the Street forecasts the company to post earnings of $0.58 per share, up 163.6% year-over-year. The company’s efforts to control operating expenses through headcount reductions are expected to have aided bottom-line growth.
Is Block Stock a Good Buy?
Overall, SQ has a Strong Buy consensus rating on TipRanks. This is based on 19 Buy and three Hold recommendations. The average stock price target of $84.50 implies a 28.6% upside potential from the current level.
Insights from Options Trading Activity
Options traders are pricing in a +/- 13.24% move on earnings, greater than the previous quarter’s earnings-related move of 10.69%.
Learn more about TipRanks’ Options tool here.
Concluding Thoughts
Block’s focus on cost-control measures and efforts to strengthen its merchant ecosystem bode well for long-term growth. However, macro headwinds impacting consumer spending and increased competition remain key concerns.
