Education
About Us
Working with TipRanks
Follow Us
Block (XYZ)
NYSE:XYZ
Top Page
Block
(NYSE:XYZ)
72Outperform
Positive Factors
Business Expansion
Square plans to accelerate more hiring as a result of market share gains in its core verticals.
Regulatory Approval
A key driver of this rebound would be the company’s rollout of Cash App Borrow – small-dollar, short-duration loans – to millions more Cash App active users after it received FDIC approval to use Square Financial Services to issue consumer loans nationwide.
Negative Factors
Analyst Downgrade
The company has been downgraded from Buy to Neutral due to disappointing Q1 results.
Financial Performance
Gross profit missed the first-quarter guidance by $30 million, and the full-year forecast was lowered by $200 million.
Growth Concerns
The recent slowdown at Cash App may be indicative of a lower baseline growth rate going forward, reducing confidence in the medium-term growth potential for Cash App.
Block (XYZ) vs. S&P 500 (SPY)
Market Cap
$28.62B
Dividend YieldN/A
Average Volume (3M)9.91M
Price to Earnings (P/E)10.2
Beta (1Y)1.95
Revenue Growth10.06%
EPS Growth38060.98%
CountryUS
Employees12,000
SectorTechnology
Sector Strength68
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)4.55
Shares Outstanding555,001,000
10 Day Avg. Volume11,307,803
30 Day Avg. Volume9,913,218
Financial Highlights & Ratios
PEG Ratio0.00027
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.85
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit5.94
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$66.74Price Target Upside43.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering32
Block Business Overview & Revenue Model
Company DescriptionBlock (XYZ) is a diversified technology company operating in the financial services sector, primarily focused on providing innovative solutions for digital payments and financial management. The company offers a suite of products and services, including point-of-sale systems, peer-to-peer payment platforms, and cryptocurrency-related services, catering to both businesses and individual consumers.
How the Company Makes MoneyBlock (XYZ) generates revenue through several key streams. The primary source is transaction fees, which are charged to businesses for using its point-of-sale systems and payment processing services. Additionally, the company earns money from its peer-to-peer payment platform by charging fees for instant transfers and certain transaction types. Block (XYZ) also derives income from its cryptocurrency services, including trading fees and asset management services. Significant partnerships with financial institutions and technology providers enhance its market reach and contribute to its financial performance.
Block Financial Statement Overview
Summary
The company has demonstrated strong financial improvements, including robust revenue growth, improved profitability margins, and enhanced cash flow generation. The balance sheet shows financial stability with a declining debt-to-equity ratio.Income Statement
The company has demonstrated a robust revenue growth with a stable increase over the years. Gross profit margin is healthy, indicating good cost management. The net profit margin has significantly improved from past losses, showcasing effective turnaround strategies. EBIT and EBITDA margins have also shown positive trends, aligning with the industry's growth trajectory.85
Very Positive
Balance Sheet
The balance sheet reflects a strong equity position relative to debt, with a declining debt-to-equity ratio demonstrating improved financial stability. Return on equity has turned positive, indicating efficient use of equity in generating profits. The equity ratio is solid, although there is room for optimizing asset utilization.75
Positive
Cash Flow
The company exhibits strong cash flow management, with substantial growth in free cash flow, supported by consistent operating cash flows. The operating cash flow to net income ratio reflects a healthy cash generation capability. The free cash flow to net income ratio suggests effective conversion of profits to cash, enhancing financial flexibility.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 24.12B | 21.92B | 17.53B | 17.66B | 9.50B | Gross Profit |
| 8.89B | 7.50B | 5.99B | 4.42B | 2.73B | EBIT |
| 892.33M | -278.84M | -577.96M | 261.71M | 272.91M | EBITDA |
| 1.35B | 390.53M | -58.76M | 408.48M | 427.38M | Net Income Common Stockholders |
| 2.90B | 9.77M | -553.00M | 166.28M | 213.10M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 12.75B | 9.42B | 8.81B | 8.14B | 5.89B | Total Assets |
| 36.78B | 33.03B | 31.36B | 13.93B | 9.87B | Total Debt |
| 7.92B | 6.07B | 6.33B | 5.52B | 3.49B | Net Debt |
| -4.34B | -2.10B | -1.39B | 1.07B | -1.70B | Total Liabilities |
| 15.54B | 14.34B | 14.11B | 10.61B | 7.19B | Stockholders Equity |
| 21.27B | 18.70B | 17.22B | 3.27B | 2.68B |
| Cash Flow | Free Cash Flow | |||
| 1.55B | -50.19M | 5.09M | 543.51M | 243.20M | Operating Cash Flow |
| 1.71B | 100.96M | 175.90M | 847.83M | 381.60M | Investing Cash Flow |
| 649.95M | 683.20M | 1.23B | -1.31B | -606.64M | Financing Cash Flow |
| 1.95B | -240.14M | 97.58M | 2.65B | 3.68B |
Block Technical Analysis
Negative
46.53
Price Trends
57.61
Negative
72.93
Negative
71.94
Negative
Market Momentum
-0.97
Negative
32.27
Neutral
60.86
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XYZ, the sentiment is Negative. The current price of 46.53 is below the 20-day moving average (MA) of 54.47, below the 50-day MA of 57.61, and below the 200-day MA of 71.94, indicating a bearish trend. The MACD of -0.97 indicates Negative momentum. The RSI at 32.27 is Neutral, neither overbought nor oversold. The STOCH value of 60.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for XYZ.
Block Risk Analysis
Block disclosed 48 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
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $38.30B | 17.24 | 16.61% | 1.56% | 4.09% | 14.05% | |
74 Outperform | $42.94B | 27.73 | 21.43% | ― | 58.74% | 1127.29% | |
72 Outperform | $28.62B | 10.23 | 12.93% | ― | 10.06% | 38060.98% | |
70 Outperform | $26.83B | 69.30 | 15.37% | ― | 25.63% | 118.49% | |
68 Neutral | $31.72B | 179.20 | 7.75% | ― | 26.12% | 274.50% | |
60 Neutral | $10.94B | 10.58 | -7.08% | 2.98% | 7.52% | -12.04% | |
54 Neutral | $38.32B | 51.02 | 4.65% | 1.88% | -17.38% | ― |
* Technology Sector Average
Performance Comparison
XYZ
Block
46.53
-27.00
-36.72%
CTSH
Cognizant
77.70
12.31
18.83%
FIS
Fidelity National Info
78.86
9.73
14.07%
TTD
Trade Desk
54.09
-37.27
-40.79%
DDOG
Datadog
105.00
-21.97
-17.30%
HOOD
Robinhood Markets
48.59
30.81
173.28%
Block Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: -20.43%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive and negative elements. While the company showed strong gross profit growth and record adjusted operating income, challenges such as lower-than-expected Cash App performance and a cautious macroeconomic outlook were highlighted. The company's strategic initiatives, particularly in expanding Cash App and Square, are promising, although they remain cautious about potential macroeconomic headwinds.Q1-2025 Updates
Positive Updates
Strong Gross Profit Growth
Total Block gross profit was $2.29 billion, up 9% year-over-year. Square had a gross profit growth of 9% year-over-year, driven by GPV growth of 7.2%, with constant currency GPV growth of 8.2%.
Record Adjusted Operating Income
Adjusted operating income was $466 million, up 28% year-over-year, and adjusted EBITDA was $813 million, up 15% year-over-year.
Cash App Growth Initiatives
The FDIC approval to use Square Financial Services to issue consumer loans for Cash App Borrow nationwide is expected to double the number of Cash App actives that can be offered Borrow, starting in the third and fourth quarters.
Cash App Afterpay Integration
Successful early adoption and strong conversion rates for Cash App Afterpay, which allows users to split purchases retroactively on their Cash App Card.
Square Product and Go-to-Market Enhancements
Continued product innovation in Square with new features and enhancements, and successful signing of upmarket sellers through field sales and partnerships.
Negative Updates
Cash App Gross Profit Below Expectations
Cash App gross profit was up 10% year-over-year, but below expectations due to changes in consumer spending behavior, particularly around tax refund season.
Cautious Outlook Due to Macro Environment
The company has taken a more cautious stance on the macroeconomic environment, impacting guidance with anticipated gross profit growth of 12% for 2025.
Challenging Consumer Spending Behavior
Observed changes in consumer spending behavior, with a pronounced shift during the tax refund season impacting Cash App inflows and discretionary spending.
Company Guidance
During the Block First Quarter 2025 Earnings Conference Call, the company provided updated guidance and performance insights across several metrics. Total Block gross profit for Q1 2025 was $2.29 billion, marking a 9% year-over-year increase. Square's gross profit grew by 9% year-over-year driven by a 7.2% increase in gross payment volume (GPV), with constant currency GPV growth at 8.2%. Cash App gross profit rose by 10% year-over-year, although consumer spending behavior during tax refund season affected inflows. The company reported an adjusted EBITDA of $813 million, up 15% year-over-year, and adjusted operating income of $466 million, a 28% increase. For the full year, Block expects gross profit growth of 12% or $9.96 billion, with anticipated acceleration in the second half of the year. Adjusted operating income for 2025 is projected to be $1.9 billion, reflecting continued investment in high ROI growth initiatives. Additionally, the company plans to expand its Cash App Borrow product nationwide and expects significant contributions from its retroactive buy-now-pay-later product, Cash App Afterpay, in the second half of the year.Block Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Block Expands Board with Anthony Eisen Appointment
Positive
Feb 6, 2025
On February 6, 2025, Block, Inc. expanded its Board of Directors by electing Anthony Eisen, Co-Founder of Afterpay and CEO of Reshop, as a Class III director. Eisen’s extensive experience in financial services and Buy Now, Pay Later solutions, particularly through Afterpay, is expected to contribute significantly to Block’s strategic growth and evolution in financial services.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.