Fintech specialist Block (Nyse: xyz) He recently reported on his financial results in the fourth quarter and throughout the year 2024, and the market at least was not impressed. The company’s shares significantly fell on the fifth of this last quarterly update. However, analysts on Wall Street seem to think it was an exaggerated reaction.
Based on the current average Block price of $ 95.75 (according to analysts accompanied by Yahoo! Finance), the company’s shares could rise by about 47%. Should investors buy street optimism and pick up blocks of stock on DIP?
First, let’s review what the block does. The company became known for offering small and medium -sized companies elegant, appropriate sales systems. AND Financial Services Company He evolved the past of this phase. Block provides various products to companies through its Square (its former name) ecosystem, including payrolls, marketing, banking services and more. Block also owns a PEER-PEER (P2P) payment app, Cash app, which competes with banks, offering pre-paid debit cards, supplies and crypto trade services, direct deposits, small loans and more.
Although he had some success, Block is increasingly engaged in strong competition that affects his financial results.
The Block shares Pale after its update in the fourth quarter, because its results of the upper and lower lines were lower than the expectations of analysts. The company’s revenue increased by only 4.5% compared to about $ 6 billion. Block -ow upper line doesn’t grow as fast as it used to be. The gross profit increased by 14% compared to the year (appropriate company guidelines) to $ 2.3 billion, and the cash application and the Square Ecosystems had decent appearances in this department. The Block’s custom earnings per share was $ 0.71 for the quarter, which represented an increase of 51% compared to the period before the year.
Will be challenging block to fill the average analyst goal In the next year. Powerful financial results in the upcoming districts could provide potential catalysts, but it seems that the company does not make it particularly probably that it will achieve the results of blowing its kind that will send the price of shares. Block expects his gross profit for the 2025th year to grow by about 15% compared to the year to $ 10.2 billion. This is not bad, but it will not lead to the type of return that Wall Street expects in the next 12 months.
So do not expect the block -the price of the shares will reach just $ 100 within 12 months. This does not mean that the section is not a purchase, and in my opinion, one significant argument in favor of the company is that it has just begun to understand its full ambition. Block has made significant changes and accessories in recent years to connect his two ecosystems, Square and Cash App. They include paying cash applications, paying platform and afterpay, buy now, pay later (BNPL) service. Block hopes in the long run to establish a lucrative trade between Square and Cash App, which will completely facilitate the tools within its ecosystem.
