DA Davidson ‘increasingly confident’ defending Block after short attack

DA Davidson analyst Christopher Brendler keeps a Buy rating and $130 price target on Block following last week’s short thesis by Hindenburg. DA Davidson states that while the shortseller has a "solid reputation" and deserves to be taken seriously, its analysis suggests the Hindenburg case is "considerably weaker than the market reaction implies". Block’s fundamentals are improving given its impressive Q4 results, and the stock’s valuation at an all-time low – trading below 20-times expected EBITDA for the first time – is creating a compelling short-term buying opportunity, the analyst tells investors in a research note.