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Goldman Sachs Comments on Block Inc. (SQ)

May 3, 2024 5:59 AM

Goldman Sachs analyst Michael Ng reiterated a Buy rating and $94.00 price target on Block Inc. (NYSE: SQ).

The analyst comments "SQ's 2Q24 gross profit, AOI, and EBITDA beat on better-than-expected performance in both Cash App & Seller gross profit as well as better opex. SQ’s upgraded 2024 EBITDA/AOI outlook, which is underpinned by continued cost discipline and at least 17% gross profit growth (with Cash App gross profit growth faster than Square), was better-than-expected and demonstrates momentum that provides line of sight to SQ’s reiterated 2026 Rule of 40 target (v. Rule of 29 in 2023) on AOI margins and gross profit growth. 2024 growth should be driven by: (1) at least 17% consolidated gross profit growth with faster growth at Cash App driven by momentum in monthly inflows from financial services initiatives including savings & direct deposit; (2) Seller product initiatives with a focus on reliability, F&B and services offerings, and faster onboarding; and (3) continued cost discipline through enforcement of a 12,000 employee cap and leverage on corporate overhead expenses."

For an analyst ratings summary and ratings history on Block Inc. click here. For more ratings news on Block Inc. click here.

Shares of Block Inc. closed at $70.30 yesterday.

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