Judging by the sharp rally in Block Inc. shares, you could say it was a blockbuster quarter for the Square and Cash App parent company.<\/p>\n
Block\u2019s stock The company\u2019s \u201cprogress over the past several months in terms of streamlining itself organizationally, sharpening its focus within its two key businesses Square and Cash App, and becoming hyper-focused on driving profitable growth has been impressive \u2014 and we think there\u2019s more to go,\u201d wrote Seaport Research analyst Jeff Cantwell. <\/p>\n He turned bullish on Block\u2019s stock after its Thursday afternoon earnings report, cheering management\u2019s \u201cexcellence in execution\u201d and the company\u2019s \u201ccompelling\u201d margin expansion. Block posted a 28% margin on adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) \u2014 up 1,100 basis points from a year before. <\/p>\n \u201cWe think it\u2019s very rare to see that level of operating leverage in the space right now, particularly in the current macro environment, and it\u2019s the key reason which compels us to change our investment thesis on the company,\u201d Cantwell wrote, as he lifted his price target on the stock to buy from neutral. He has a $95 target price on shares. <\/p>\n Benchmark Company analyst Mark Palmer lauded Block as \u201cone of the most compelling stock stories\u201d in fintech, in part due to his \u201cexpectation that management\u2019s focus on controlling expense growth would have a dramatic impact on SQ\u2019s profitability.\u201d<\/p>\n Further, Palmer is upbeat about Block\u2019s work to grow its Cash App mobile wallet and convince more users to try banking services within it. <\/p>\n He pointed to his \u201dbelief that the Cash App\u2019s ability to serve as a bank-account substitute for millions of unbanked and underbanked consumers, combined with management\u2019s efforts to boost monetization through price increases, would drive the company\u2019s top- and bottom-line growth.\u201d<\/p>\n Palmer rates the stock at buy with an $89 target price. <\/p>\n
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\n was ahead nearly 20% in afternoon trading Friday and would log its best day in over 15 months \u2014 since it rose 26.1% on Feb. 25, 2022\u00a0\u2014 if current gains carried through to the close. The payment-technology company showed bottom-line improvement with its latest report<\/a> and impressed Wall Street with its talk of efficiency. <\/p>\n