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Here's Why BMO Capital Upgraded Block

  • BMO Capital analyst James Fotheringham upgraded Block Inc (NYSE: SQ) to Outperform from Market Perform with an unchanged price target of $159.

  • Following a 70% de-rating of the shares over the past 12 months, the analyst expects Block to re-rate to a 60-times price-to-earnings ratio based on 2023 estimates given its 32% organic revenue growth potential.

  • Fotheringham also expects Block will "surprise positively" on growth and earnings.

  • Fotheringham's model is more bullish than consensus due to out-year forecasts for a "softer landing" for Cash App and Afterpay accretion revenue growth and earnings.

  • The analyst highlights the company's investor day on May 18 as a potential positive catalyst.

  • Price Action: SQ shares traded lower by 1.98% at $117.45 in the premarket on the last check Monday.

Latest Ratings for SQ

Feb 2022

DA Davidson

Maintains

Buy

Feb 2022

BMO Capital

Upgrades

Market Perform

Outperform

Feb 2022

Truist Securities

Maintains

Buy

View More Analyst Ratings for SQ

View the Latest Analyst Ratings

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