Square (SQ) PT Raised to 'Street High' $380 at Mizuho Securities; Bull Case of $650

February 22, 2021 6:34 AM EST
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Price: $238.70 +1.16%

Rating Summary:
    30 Buy, 18 Hold, 4 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 14 | Down: 9 | New: 25
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Mizuho Securities analyst Dan Dolev raised the price target on Square (NYSE: SQ) to a 'Street High' $380.00 (from $300.00) while maintaining a Buy rating, calling shares undervalued. The firm also set a bull case of $650.

The analyst commented, "We believe SQ is simply undervalued. Our terminal value DCF analysis shows by 2031, Cash App and Seller GP may exceed $30bn and $6bn, respectively. Our base case implies share price of $380; bull case implies over $650.

With <3% penetration of a $165bn TAM, enhanced momentum with Bitcoin's ascent, and an inflow of equity traders post-GameStop, SQ is barely scraping its full potential, in our view. SQ's former CFO Sarah Friar succinctly summed up the company's growth philosophy as: "drive the top line...which will ultimately mean a much more valuable DCF."

We believe with a ~200% three-year CAGR, Cash App emerges as the ultimate 'super-app' epitomizing the company's growth philosophy. Raising PT to $380"

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