Block (SQ) Gains But Lags Market: What You Should Know
Block (SQ) closed the most recent trading day at $68.65, moving +0.23% from the previous trading session. This move lagged the S&P 500's daily gain of 1.44%. Elsewhere, the Dow gained 1.26%, while the tech-heavy Nasdaq added 5.21%.
Prior to today's trading, shares of the mobile payments services provider had lost 12.24% over the past month. This has lagged the Business Services sector's gain of 0.14% and the S&P 500's gain of 2.28% in that time.
Block will be looking to display strength as it nears its next earnings release. In that report, analysts expect Block to post earnings of $0.32 per share. This would mark year-over-year growth of 77.78%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.56 billion, up 15.13% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.67 per share and revenue of $19.76 billion. These totals would mark changes of +67% and +12.69%, respectively, from last year.
Any recent changes to analyst estimates for Block should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 34.25% higher within the past month. Block is currently a Zacks Rank #3 (Hold).
Valuation is also important, so investors should note that Block has a Forward P/E ratio of 41.13 right now. For comparison, its industry has an average Forward P/E of 22.22, which means Block is trading at a premium to the group.
Investors should also note that SQ has a PEG ratio of 1.98 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SQ's industry had an average PEG ratio of 1.98 as of yesterday's close.
The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 40% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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