Payment processing company Block (NYSE:SQ) is becoming the chopping block for a slew of jobs. Investors seem pretty happy about this, sending shares up nearly 5%, as Block becomes the latest tech company to slash jobs.
Starting March 30, Block will cut 112 jobs as part of a larger measure designed to reduce costs. The advanced notice came as part of the WARN, the Worker Adjustment and Retraining Notification Act. Block is trying to get out in front of souring macroeconomic conditions, particularly high-interest rates and a decline in consumer spending. Block has also been cutting jobs at its Tidal music streaming service, showing that it’s pushing for leaner operations wherever it can.
A Greater Potential Awaits?
It’s certainly good news that Block is paring back its expenses, even if there’s a hefty human cost to consider here. At least, it’s good news for shareholders; Block has been struggling for some time now, particularly as it tried to branch out into other operations. Indeed, not so long ago, reports noted that the federal government was getting directly involved, investigating whether Block’s Cash App function was providing assistance to money launderers and terrorists. Whistleblowers came forward to note that the app “…had no effective procedure” to establish customer identity. But with a few key changes, things could turn around for Block.
Is Block Stock a Buy or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on SQ stock based on 19 Buys and four Holds assigned in the past three months, as indicated by the graphic below. After a 9.01% loss in its share price over the past year, the average SQ price target of $84.43 per share implies 24.84% upside potential.
