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Block
(NYSE:XYZ)
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Rating:74Outperform
Price Target:
$94.00
▲(21.84% Upside)
Action:Reiterated
Date:08/06/26
The score is driven primarily by improving fundamentals (sharp cash flow/free-cash-flow strengthening and manageable, improving leverage) and supportive technical momentum (price above key moving averages and positive MACD). Offsetting these positives are a step-down in profitability/ROE versus prior peaks and a stretched valuation (high P/E and no dividend yield), which increases sensitivity to continued execution against raised guidance.
Positive Factors
Strengthened Cash Flow
A durable jump in operating and free cash flow and very strong FCF growth (~+47.8% TTM) materially improves financial flexibility. Strong cash conversion supports continued product investment, capital allocation optionality, and resilience to cyclical shocks over the next several quarters.
Negative Factors
Compressed Profitability / Low ROE
A sharp decline in ROE and compressed net margins indicate weaker capital efficiency versus recent peaks. Persistently low returns on a large equity base can limit shareholder value creation and mean management must sustain higher top-line growth or margin recovery to restore long-term profitability metrics.
Read all positive and negative factors
Positive Factors
Negative Factors
Strengthened Cash Flow
A durable jump in operating and free cash flow and very strong FCF growth (~+47.8% TTM) materially improves financial flexibility. Strong cash conversion supports continued product investment, capital allocation optionality, and resilience to cyclical shocks over the next several quarters.
Read all positive factors
Block Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down income from different business units, highlighting which areas are driving growth and which may need strategic adjustments.
Breaks down income from different business units, highlighting which areas are driving growth and which may need strategic adjustments.
Data provided by:
The Fly
The FlyBlock (XYZ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$47.03B
Dividend YieldN/A
Average Volume (3M)5.43M
Price to Earnings (P/E)145.8
Beta (1Y)1.50
Revenue Growth5.07%
EPS Growth-87.94%
CountryUS
Employees10,205
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.57
Shares Outstanding540,816,000
10 Day Avg. Volume4,894,257
30 Day Avg. Volume5,426,180
Financial Highlights & Ratios
PEG Ratio-0.56
Price to Book (P/B)1.79
Price to Sales (P/S)1.65
P/FCF Ratio16.44
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$97.96Price Target Upside26.98% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering29
EPS Forecast (FY)4.05
Revenue Forecast (FY)$26.01B
Block Business Overview & Revenue Model
Company Description
Block, Inc., operating through its subsidiaries, develops innovative tools that empower merchants to process card payments, gain insights from robust reporting and analytics, and benefit from expedited next-day fund settlement. The company offers ...
How the Company Makes Money
Block primarily makes money through a mix of transaction-based revenues, subscription/service fees, and Bitcoin-related revenue (reported on a gross basis). Within Square (the seller ecosystem), a key revenue stream is payment processing: when a m...
Block Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call presents a predominantly positive picture: broad-based revenue and gross profit growth, record profitability and raised full-year guidance driven by strong execution across Square and Cash App, rapid product velocity (AI-enabled), and successful new product traction (Neighborhoods, Tags, Buzz). Offsetting risks are manageable at this stage — normalization of Borrow growth, modest Cash App actives growth, AI compute/token cost pressure, and potential hardware/memory cost inflation — but management articulated clear mitigation strategies and optionality (model-agnostic AI routing, strong supply-chain relationships, SFS deposit/acquiring roadmap). Overall, highlights significantly outweigh lowlights.Positive Updates
Record Profitability and Raised Full-Year Guidance
Achieved record profitability in Q2 with 27% adjusted operating income margin (all-time high). Raised 2026 guidance: full-year gross profit of $12.51B (up 21% YoY), adjusted operating income of $3.47B (28% margin), and adjusted diluted EPS growth of 70% YoY.
Negative Updates
Normalization of Consumer Lending Growth (Borrow)
Consumer lending origination volume grew 59% YoY in Q2, but management expects normalization of Borrow growth in the back half of 2026 as tougher comps from prior-year scaling are lapped; origination normalization could temper near-term gross profit upside from lending.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Profitability and Raised Full-Year Guidance
Achieved record profitability in Q2 with 27% adjusted operating income margin (all-time high). Raised 2026 guidance: full-year gross profit of $12.51B (up 21% YoY), adjusted operating income of $3.47B (28% margin), and adjusted diluted EPS growth of 70% YoY.
Read all positive updates
Company Guidance
Management raised 2026 guidance after a strong Q2: full‑year gross profit of $12.51 billion (up 21% YoY), adjusted operating income of $3.47 billion (28% margin), and adjusted diluted EPS growth of ~70% YoY. For Q3 they expect year‑over‑year gross profit growth of 18%, an adjusted operating income margin of 28% and adjusted diluted EPS growth of 89%; interest expense of $50–55M in Q3 ( $200–210M full year) and a mid‑20% non‑GAAP effective tax rate for Q3 and the full year. The raise flowed from Q2 outperformance (Q2 gross profit +25% YoY, record 27% adjusted operating income margin, adjusted diluted EPS +65% YoY), with Square gross profit and GPV +13% YoY, Cash App gross profit +31% YoY, Cash App monthly transacting actives +3% YoY in June (expecting low single‑digit actives growth for 2026), Cash App commerce enablement volume +17%, consumer lending originations +59%, and management reiterated that gross profit should grow roughly in line with GPV in H2 as they invest in go‑to‑market, Neighborhoods and AI.Block Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
68
Positive
Cash Flow
85
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 25.04B | 24.19B | 24.12B | 21.92B | 17.53B | 17.66B |
| Gross Profit | 11.61B | 10.36B | 8.89B | 7.50B | 5.99B | 4.42B |
| EBITDA | 1.19B | 2.19B | 1.74B | 379.42M | -188.57M | 554.99M |
| Net Income | 357.14M | 1.31B | 2.90B | 9.77M | -540.75M | 166.28M |
Balance Sheet | ||||||
| Total Assets | 39.16B | 39.55B | 36.78B | 33.03B | 31.36B | 13.93B |
| Cash, Cash Equivalents and Short-Term Investments | 6.74B | 11.96B | 12.75B | 9.42B | 8.81B | 8.14B |
| Total Debt | 6.58B | 8.97B | 7.92B | 6.07B | 6.33B | 5.52B |
| Total Liabilities | 17.15B | 17.38B | 15.54B | 14.34B | 14.11B | 10.61B |
| Stockholders Equity | 22.01B | 22.20B | 21.27B | 18.70B | 17.22B | 3.27B |
Cash Flow | ||||||
| Free Cash Flow | 4.82B | 2.42B | 1.55B | -50.19M | 5.09M | 543.51M |
| Operating Cash Flow | 5.02B | 2.58B | 1.71B | 100.96M | 175.90M | 847.83M |
| Investing Cash Flow | -2.94B | -2.80B | 649.95M | 683.20M | 1.23B | -1.31B |
| Financing Cash Flow | -354.19M | -613.10M | 1.95B | -240.14M | 97.58M | 2.65B |
Block Technical Analysis
Positive
77.15
Price Trends
77.02
Positive
72.47
Positive
67.86
Positive
Market Momentum
0.83
Positive
58.54
Neutral
28.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XYZ, the sentiment is Positive. The current price of 77.15 is below the 20-day moving average (MA) of 80.47, above the 50-day MA of 77.02, and above the 200-day MA of 67.86, indicating a bullish trend. The MACD of 0.83 indicates Positive momentum. The RSI at 58.54 is Neutral, neither overbought nor oversold. The STOCH value of 28.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for XYZ.
Block Risk Analysis
Block disclosed 50 risk factors in its most recent earnings report. Block reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Block Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $19.79B | 42.43 | 23.79% | ― | 23.04% | 111.91% | |
74 Outperform | $47.03B | 145.77 | 1.62% | ― | 5.07% | -87.94% | |
71 Outperform | $1.63B | 168.06 | 0.27% | ― | 22.41% | ― | |
70 Outperform | $9.98B | 30.02 | 36.11% | ― | ― | ― | |
66 Neutral | $3.47B | 75.63 | 5.65% | ― | 32.44% | -78.82% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $331.21M | -1.88 | -32.64% | ― | 8.84% | -62.58% |
* Technology Sector Average
XYZ
Block
83.09
7.29
9.62%
RPAY
Repay Holdings
3.83
-1.60
-29.47%
FOUR
Shift4 Payments
48.00
-42.85
-47.17%
MQ
Marqeta
16.47
-8.37
-33.70%
TOST
Toast Inc
35.22
-7.93
-18.38%
PAYP
PayPay Corporation
14.65
-3.51
-19.33%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.