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Benzinga
Benzinga
Business
Anusuya Lahiri

Here's Why Block's Shares Are Trading Higher Premarket

Block Street SQ Citi Peter Christiansen Afterpay
  • Analysts maintained their faith in Block Inc (NYSE:SQ) post Q4 results.
  • Citi analyst Peter Christiansen says Block's Q4 results were better than expectations, topping Citi's gross profit estimates by 8% and Street estimates by 2%. 
  • The company held off from issuing a formal fiscal 2022 outlook. However, it is now planning an investor day for May 18, where investors should get a fuller picture of AfterPay integration plans and further details on unit economics. 
  • The analyst thinks the results, newly disclosed trends, and positive nearer-term comments "equate to a win" for Block investors. 
  • Christiansen expects Street estimates and sentiment to improve from here. 
  • He recommends a Buy rating and a $220 price target (131.6% upside).
  • Deutsche Bank analyst Bryan Keane lowered the price target on Block from $210 to $180 (89.5% upside) and kept a Buy. 
  • The analyst says the company delivered solid Q4 gross profit growth. 
  • Block gave limited forward guidance, commenting on January and February trends and directionally pointing towards a tougher comp in March, likely leading to a wide spread of Street estimates. 
  • He cites lower peer group valuations and more conservative estimates for the target drop.
  • Needham analyst Mayank Tandon maintained Block with a Buy and lowered the price target from $315 to $175 (84% upside).
  • JPMorgan analyst Tien-tsin Huang lowered the price target on Block from $200 to $192 (102% upside) and maintained an Overweight rating on the shares.
  • Price Action: SQ shares traded higher by 16.7% at $110.83 in the premarket on the last check Friday.
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