According to insiders at Macquarie, the drop in Block shares since the end of July offers an attractive buying opportunity. Analyst Wei Sim expects Block’s growth to greatly accelerate in the fourth quarter.
Sim, an analyst at Macquarie, sees Block’s cash apps business as one of the company’s biggest strengths and expects growth to continue to accelerate year-over-year in the fourth quarter.
“Management emphasized that it’s focused on allowing developers to integrate third-party platforms to provide more information to large sellers, a notable point given the typically gated benefits of using Cash App and Square POS, which we’ve already discussed,” Sim says. .
Despite Block’s upbeat business outlook, Macquarie anticipates continued uncertainty in the company’s buy now, pay later segment. As a reminder, Block purchased Australian fintech company Afterpay for $29 billion in 2021.
Macquarie expert Wie Sim sees potential for shares to $101. “The stock is undervalued. We are updating the stock based on improved positioning and fundamentals,” Sim wrote in a note to clients.
However, risk-averse investors can still get their foot in the door. Those who are already invested let the profits run with the trailing stop.
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