Competition beginning to take toll on Square, says Mizuho

Block’s (SQ) Square has been the "crown jewel" of the modern U.S. point-of-sales industry for many years, but increasing competitive pressures from next-generation systems and lack of vertical-specific expertise "are beginning to take their toll," Mizuho analyst Dan Dolev tells investors in a research note. The analyst’s analysis of web traffic data hints of emerging weakness for Block versus key competitors. A volume comparison versus Toast (TOST) and Clover shows relative share loss for Block, says Dolev. In addition, his recent proprietary survey of Toast restaurants singled out Square as the largest share donor to the company. Dolev keeps a Neutral rating on Block with a $70 price target.