|Bid||0.00 x 800|
|Ask||0.00 x 1000|
|Day's Range||55.91 - 58.85|
|52 Week Range||49.82 - 101.15|
|Beta (3Y Monthly)||3.11|
|PE Ratio (TTM)||N/A|
|Earnings Date||Nov 5, 2019 - Nov 11, 2019|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||81.94|
Think stock chart analysis in growth stocks is bewildering? Take comfort knowing only a few patterns are worth identifying. Learn the cup without handle.
(Bloomberg) -- Jack Dorsey’s Square Inc. already lets customers buy and sell Bitcoin on its popular Cash App. Soon, it may let them buy and sell stocks. Square is testing out a new Cash App feature that would enable users to make free stock trades, according to a video outlining the product’s features seen by Bloomberg. While the exact date of its launch is yet to be determined, employees began testing the new feature in recent weeks, according to a person familiar with the company who asked not to be identified discussing private matters.A spokesman for Square declined to comment.The free stock trading feature would position Square as a direct competitor to fintech startup Robinhood Markets Inc., which has gained millions of customers by offering no-fee trading, and most recently garnered a valuation of $7.6 billion. Robinhood has since expanded into other offerings such as options trading and margin trading, which would not be offered in Square’s initial product, the person said. Eventually, Square’s new service and others like it could pose a challenge to more established online brokers, like E*Trade Financial Corp.“We are seeing the cadence of free trading increase and I do think that’s something the broader industry can’t dismiss,” said Devin Ryan, an analyst with JMP Securities. “As a result, the pricing in those areas will continue to move lower.”Cash App and other peer to peer payment platforms are known for having a young customer base, similar to Robinhood. If Robinhood is any indication of the interest in free trading, Square could quickly gain a lot of traction. Prior to Robinhood's launch, it had a waitlist of 1 million people. Near the end of 2018, it said it had more than 6 million users, though it's unclear how many of them are active on the platform.Square’s Cash App started out by letting users send money to friends, and has since expanded into debit cards and Bitcoin trading. While Square doesn't consistently give updates on how many people are using Cash App, the company said it had more than 15 million monthly active users as of last December. Though there isn’t an immediate path to profitability for most free financial products, the race to add more users to platforms like Cash App has been fierce, with other businesses like PayPal Holdings Inc.’s Venmo also seeing big growth.Right now, fintech companies offering such products largely make money on the interchange fees when customers use their debit cards or on fees they charge for transferring funds to banks instantly. In its most recent letter to shareholders, Square said that revenue from Cash App was $135 million for the quarter, excluding Bitcoin. In a note published earlier this month, KeyBanc analyst Josh Beck said revenue from Cash App could reach $2 billion over the next three years. (Updates with analyst quote in fifth paragraph.)To contact the author of this story: Julie Verhage in New York at email@example.comTo contact the editor responsible for this story: Anne VanderMey at firstname.lastname@example.org, Mark MilianTom GilesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
U.S. stock futures are trading higher this morning and now sit a whisker from new records.Source: Shutterstock Ahead of the bell, futures on the Dow Jones Industrial Average are up 0.32%, and S&P 500 futures are higher by 0.22%. Nasdaq-100 futures have added 0.07%.In the options pits, calls continued their recent trend of trouncing put demand while overall volume came in near average levels. By the time the closing bell rang, 21.7 million calls and 16.5 million puts traded. Meanwhile, over at the CBOE, the single-session equity put/call volume ratio remained near its two-month low at 0.55. With the spate of low readings in September, the 10-day moving average continues to be pulled lower to close under 0.62.InvestorPlace - Stock Market News, Stock Advice & Trading TipsA diverse group of equities landed atop the most-active options leaderboard. Coca-Cola (NYSE:KO) was flooded with options volume ahead of today's dividend payout. Square (NYSE:SQ) fell to a nine-month low on above-average volume. Finally, Intel (NASDAQ:INTC) rallied for its seventh day in a row, but resistance overhead gave a reason for put buying. * 10 Big IPO Stocks From 2019 to Watch Let's take a closer look: Coca-Cola (KO)Consumer staples have enjoyed a consistent upward march this year, and nowhere has the trend been more obvious than in Coca-Cola. Plunging interest rates are creating renewed demand for dividend payers. KO stock's 2.92% stands tall compared to the 10-year yield, which is plumbing to the depths near 1.75%.And it is this juicy dividend that options traders have to thank for Thursday's explosive volume. The boom in call volume was driven by investors seeking short-term control of the stock for eligibility to the upcoming 40 cent quarterly payment. KO is trading ex-dividend this morning requiring you to have owned it by yesterday's close to participate in the next pay-day.As is usual with dividend targeting, calls drove the bus with activity zooming to 721%. In total, 206,418 contracts changed hands with 95% of the tally coming from calls.Implied volatility pushed to 20% landing it at the 29th percentile of its one-year range. Premiums are baking in daily moves of 69 cents or 1.3%. Square (SQ)The broad market is a whisker from record highs, but some sick stocks are sinking toward 52-week lows. You can count Square shares among the ill. SQ fell for the fifth straight day yesterday amid increasing distribution.And the charts leave little room for optimism moving forward. The next potential support zone isn't until $52.50, which is 9% lower. While buyers could swoop in to the save the stock before then, I certainly wouldn't bet on it with every major moving average now pointing lower.On the options trading front, puts outpaced calls by a slim margin. Total activity climbed to 250% of the average daily volume, with 159,984 contracts traded. Puts accounted for 52% of the sum.Despite the deterioration, we've seen virtually zero fear. Implied volatility just sank to 39% or the 6th percentile of its one-year range. Premiums are cheap, so if you're banking on the bears, long puts or put spreads are attractive. Intel (INTC)Intel is on the rise, notching its seventh straight daily gain yesterday. The nascent recovery has been strong enough to pull the 20-day and 50-day moving averages higher. This confirms buyers have officially wrested control of the short- and intermediate-term trends.INTC stock now stands at a critical juncture; $53.25 is a powerful resistance zone that has kept a lid on INTC ever since April's disastrous earnings drop. Tack on the fact that Intel shares are extremely overbought and this is as logical a level as any for the stock to pause. At any rate, it's not a low-risk entry, so I'd caution against piling in here. A pullback would provide a better spot to jump in. * 7 Stocks to Buy to Ride the Vegan Wave As far as options trading goes, puts proved more popular despite the day's rally. Activity swelled to 155% of the average daily volume, with 101,473 total contracts traded; 56% of the trading came from puts.Anxiety has been easing alongside the price rally. Implied volatility has fallen to 25% or the 23rd percentile of its one-year range. Premiums are pricing in daily moves of 83 cents or 1.6%.As of this writing, Tyler Craig didn't hold a position in any of the aforementioned securities. Check out his recently released Bear Market Survival Guide to learn how to defend your portfolio against market volatility. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money The post Friday's Vital Data: Coca-Cola, Square and Intel appeared first on InvestorPlace.
In this current environment, buying Twitter (NYSE:TWTR) above the psychological threshold of $40 seems risky. The last time Twitter stock was so consistently elevated was back in June of last year. During that period, TWTR was angling to break into $50 but it failed quite spectacularly.Source: Worawee Meepian / Shutterstock.com Another point to consider is what my InvestorPlace colleague Will Ashworth recently stated. Comparing Twitter to Square (NYSE:SQ), Ashworth declared that the latter was the better name. One of the reasons is that Square is fundamentally more useful and valuable than Twitter.As Ashworth points out, SQ has introduced many innovations, one of which is Square Terminal. He wrote last month:InvestorPlace - Stock Market News, Stock Advice & Trading TipsAt the Canadian launch of Square Terminal, Dorogusker, Square's head of hardware, told reporters that the portable terminal provides small- and medium-sized businesses with the ability to manage inventory, send invoices, record deposits, manage payment histories, and generate reports about their companies…The product eliminates the need for shopkeepers to deploy a slew of iPads, smartphones and tablets, to successfully operate their businesses.Plus, TWTR stock is just a social media-based investment. In that space, Facebook (NASDAQ:FB) is king, and by a very wide margin. * 10 Stocks to Sell in Market-Cursed September Having said that, Twitter stock has some surprising catalysts that could help support shares in a recession. Here are three reasons why: President Trump Loves TwitterThere's an old saying that there's no such thing as bad publicity and Twitter is testing that thesis. As we all know, President Trump loves using the social media platform. Perhaps it suits his personality. Perhaps because he's a former reality TV star, he's a master of the soundbite.Of course, it's difficult to quantify the impact the executive office has had on Twitter, and some experts have stated Trump imposes a negative influence on the company because of issues like bullying and harassment.Still, I'm going to argue that overall, this administration has provided a net positive impact on Twitter stock. Primarily, every time Trump makes a groundbreaking announcement or posts a controversial statement, it's almost always done through Twitter. When various media outlets report on the subject, the company gets free advertising.Further, Twitter caters to a younger audience, ultimately helping the company's revenue-generation efforts. Since late last year, social media has transitioned into the leading news source, besting newspapers. And Trump's tweets of consciousness inspire other politicians to respond. In many ways, Twitter is a real-time, dynamic news source. That very well might benefit Twitter stock. Political Rancor Is Good for Twitter StockRecently, Oppenheimer analysts upgraded media behemoth Comcast (NASDAQ:CMCSA). Although Comcast suffers under the broader framework of cord cutting, CMCSA has moved up significantly this year.Interestingly, one of the reasons analysts there are so optimistic is the upcoming 2020 elections. The last presidential election was a golden moment for cable TV, lifting the dying traditional news media sector. With an even more contentious political environment, cable providers like Comcast should benefit.I don't really see it that way. According to the Pew Research Center, a significant percentage (22%) of the under-50 crowd get their news from social media. Moreover, a whopping 36% of the under-30 folks get their news from sources like Twitter. Right there, you have a good reason to consider Twitter stock: the underlying company will eventually replace other sources (TV, radio, and print) for news distribution.If that doesn't convince you to think about TWTR stock, also note millennials' political engagement behaviors. Nobody in this group is writing to their Congressional representatives. Instead, they're on Twitter.This isn't just a nice little statistic. Advertisers know these trends firsthand and are willing to pay big bucks for this lucrative exposure. While we'll see many winners come November 2020, one of the biggest could be Twitter stock. Twitter Is More Open Than FacebookOne common criticism against TWTR stock is that Twitter appears a permanent number two to Facebook. As everyone knows, Facebook has well over two billion active users. On the other hand, Twitter has somewhere around 320 million active users. It's not even close.But that's not where the argument ends, at least for this comparison. In recent years, Facebook has incurred multiple scandals involving privacy violations. As a result, CEO Mark Zuckerberg has attempted to shift his organization into a more privacy-friendly platform.I don't think that's necessarily a bad move for Facebook. But compared to Twitter, this shift doesn't lend itself well to distributing political opinions. In contrast, Twitter has always encouraged openness and engagement within reason. Thus, in the 2020 elections, we should find more robust debate occurring on Twitter than on other social media networks.Coming full circle, I think that's beneficial to Twitter, and not just from the eyeball count. More young people have used social media in politically meaningful ways than any other generation. And it's young people whom advertisers most wish to target.As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post The Presidential Election Is a Twitter Stock Tailwind appeared first on InvestorPlace.
If you're bullish on Square (NYSE:SQ) and its long-term prospects, there's good news and bad news off and on the SQ stock price chart worth heeding. Let me explain.Source: Shutterstock It's no secret the initial driver for Square stock falling out of favor with investors was the company's earnings report in early August, which harbored a modestly below expectations third-quarter revenue forecast and announced sale of its Caviar business. And for an often impulsively determined Wall Street, the lack of near-term clarity trumped the longer-term growth narrative.Appreciatively, for the buy-and-hold Square stock investor it's been a difficult environment to maintain the faith. After cratering by 23% in August, September's tally thus far has racked up an additional price drop in SQ stock of 5%. What's more, after coming on strong in the first quarter of 2019 with shares sprinting to a gain of nearly 50%, SQ is barely hanging on to a positive return this year.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe frustration for Square shareholders has been likely compounded by the broader market which is up 20% after snapping back toward all-time highs after its own brief, but volatile corrective swoon in August. And now SQ stock's continued weakness is pointing to additional bad and good news for bullish investors in the days and months ahead. SQ Stock Daily Price ChartWith Wall Street still holding a grudge against Square stock, the latest price action has dismantled a higher low, double-bottom pattern loosely supported by the 62% Fibonacci retracement level. If you were bullish on the bottoming price pattern, and I'll include myself among that camp, it's time to recognize the technical failure and remain on the sidelines for the time being.Near term and backed by a weak-looking stochastics set-up, SQ stock's bearish price action suggests shares will be heading even lower in the near future. In fact, for investors unconvinced of Square's longer-term growth prospects, which isn't entirely without merit either, shorting shares makes sense.The next logical testing is last year's December low near $50. A challenge of those levels offers the promise of a minimum return on investment of nearly 15% for an investor shorting SQ stock today. While I'm not bearish and prefer simply monitoring shares for a future purchase, technically I would suggest a blended stop-loss above $63 which looks good for containing losses off and on the price chart. * 10 Battered Tech Stocks to Buy Now The good news for SQ stock bulls, if we're correct about additional downside pressure, the opportunity for much stronger value off and on the price chart is forthcoming. And with December's low already breaching Square's lifetime 50% retracement level -- a test of 62% support near $44 isn't out of the question.Disclosure: Investment accounts under Christopher Tyler's management do not own positions in any securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional options-based strategies, related musings or to ask a question, you can find and follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post A Large Problem, A Larger Opportunity for SQ Stock Investors appeared first on InvestorPlace.
Canacord Genuity analyst Josef Vafi is bullish on PayPal and neutral on Square but thinks both digital payments companies have solid fundamentals.
Canaccord Genuity analyst Joseph Vafi downgraded Square Inc (NYSE: SQ) from Buy to Hold and lowered his price target from $88 to $64. At the same time, he said the recent consolidation wave in payments has created unprecedented competition, and Square will need to demonstrate more consistent payment volume growth and more momentum in the Cash App to warrant a more premium market valuation.
For the last few days the stock markets have been healthy. Sentiment has taken a turn to positive and it's like nothing bad is ever going to happen again. Just yesterday the indices rallied through incredible levels especially in small cap stocks. So there's no doubt that there are stocks to buy here.Today we discuss three high-profile stocks to buy: Visa (NYSE:V), Amazon (NASDAQ:AMZN), and Microsoft (NASDAQ:MSFT). These are fallen angels stocks because they have recently corrected off of their highs just when they looked like their rallies would never end. * 10 Battered Tech Stocks to Buy Now The time frames differ among them, but the concept remains the same. They were headed to the moon, then they tripped. So now the opportunity is to pick the right level to buy these stocks. All three management teams are impeccable and they rarely falter on their own. So the bullish thesis for all three AMZN, MSFT and V assumes that markets in general are not going to crash any time soon.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Microsoft (MSFT)It's hard to call MSFT stock a fallen angel stock because it's still up 34% year-to-date and it's only 5% off of the highs. Nevertheless, it has had a tough time in the last trading week, and what makes it interesting is that it did this while the equity markets were rallying hard.Normally, this raises an alarm and causes me to look into weaknesses which would bring sustained selling. But that's not the case here. This is a proven company who is merely having a normal price action give-and-take inside a very healthy ascending trend.Fundamentally MSFT is not cheap since it sells at 29 trailing price-to-earnings ratio and 8 times sales. But this is a company that deserves the benefit of the doubt so it is possible that they deliver strong growth to justify the higher valuations.This is all to say that Microsoft stock is not cheap but it still is a good one to own for the long term. So these dips are normal and should not cause a panic out of the stock.Technically, the zone around $130 per share is pivotal for MSFT stock. This was resistance in April, then a break out in June, and then a successful test for support in early August when markets fell in fear of the 10% additional tariffs tweet. So clearly the bulls earned the right to use it that support.Knowing this, makes it possible for the buy-programs to prevail over the bears in the battle over MSFT for as long as the equity markets are healthy. If I own shares, I don't panic out of them on these dips. Moreover, if I want to own some for the future then this is as good a time as any to start a position there.Alternatively I can use options to sell puts or spreads below said support to generate income without needing rallies. For this, it is important to note that if stocks correct this year from geopolitical risk, then Microsoft stock is vulnerable to a 12% correction. Visa (V)V stock is in a similar situation to that of Microsoft. It's a proven winner that was seemingly rallying to the moon without interruption. But then in the last few days, it fell 6% while the general markets are up big.Here too, the drop is not a reflection on Visa itself but rather part of normal price action. For the longest time credit card stocks with a presence in the fintech space like Visa and MasterCard (NYSE:MA) have been darlings because the investment dollars allotted to bet on financials shied away from buying money-center banks like Bank of America (NYSE:BAC) and JPMorgan (NYSE:JPM). Instead they piled into fintech.However the recent rally in yields caused a frenzied wave of buying the traditional banks and money has to come from the same bucket. So there is a rotation out of winners like V stock into laggards. The opportunity here is that rotations are usually temporary. Meaning the dip in Visa stock should be a buying opportunity.Just like Microsoft, Visa is not cheap. It sells at 35 trailing P/E and 18 times its sales. But this alone is not cause for alarm because that's how it's always been. So unless the bears have developed sudden incredible fortitude, I bet that the selling will abate soon.Technically, Visa stock should have support around $172 per share. Moreover there is bigger support from pivotal zones at $165 per share. So if I owned shares I don't panic yet. If seeking a long entry with room to spare, I like to sell puts into support zones on bad days to generate income as long as I can gauge the risk. * 10 Healthcare Stocks to Buy Despite the Headlines Visa stock is 7% off its highs, so if I sell a put in V stock at $160 per share I would own it after a 15% correction. This is a risk I can tolerate and I bet would be a fruitful one. I should know that there is short-term risk looming. if Visa falls below $183.75, it could invite sellers to $168 per share. Amazon (AMZN)I cannot write about potential upside of fallen angels stocks without including the biggest momentum story of all time. AMZN stock is one that has been in the news for decades. It draws critics and fans in droves and is subject to many a heated debate.After the May correction, Amazon stock made a nice recovery but it gave almost all of it back. And it now sits 10% lower than the July highs. The size of the moves in Amazon stock should never surprise investors. This is the mother of all momentum stocks and when it moves, it does it fast and long. So it is best to wait for confirmation of breakouts in either direction before trading it.Short term, Amazon stock rallies if above $1,853 per share, and could even recover what they lost since July. There will be resistance points along the way so it won't be easy. Conversely, if it falls below recent support near $1,740 then they could extend the correction down to $1,600 per share.In essence, the battle is between completing an ABC technical move lower or establishing a base for a rebound rally to breakout from the necklines above. Meanwhile, the AMZN stock is ping-ponging inside a tight range and I should chase the break out of either sides. I personally favor the upside potential for as long as the markets in general are healthy.For those thinking of turning this into an investment, Amazon is a safe bet in the long run in spite of its high valuation. It sells at 75 trailing P/E but only 3.4 x sales. So as long as they are delivering growth, a high P/E is a prerequisite. You have to spend a lot in order to grow a lot.We still have the same geopolitical risks we had when we first started this correction. So we are one headline away from rekindled panics. This is all to say that traders shouldn't take giant positions all at once with great conviction because we have are still hostage to headlines. The best homework can be obliterated short-term by silly headlines. So I don't risk what I cannot afford to lose.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post 3 Fallen Angel Stocks to Buy Before They Fly Again appeared first on InvestorPlace.
It's important to know the difference between a broken stock and a broken company, Jim Cramer told viewers of his Mad Money program Wednesday evening. Payment processing is only gaining in popularity as every merchant goes digital, and SQ has the added benefit of Square Capital, where it uses what it knows about merchants to make loans that no other lender can make. Cramer said Wall Street appears to be fed up with the company's weak commentary and guidance after every earnings report, no matter how good that report may be.
With Square (SQ) stock down more than 25% since August 1st, is now the time to buy? That’s what some investors are asking right now. Though shares have plunged over the past month, and trading at 42% of its 52-week high, the numbers are still strong for the company. Second-quarter revenue grew 46% year-over-year, while profit surged 55%. The primary factor in Square’s decline isn’t so much its poor performance, but that analyst lofty expectations were not met in Square’s outlook guidance. Furthermore, the company’s recent sale of Caviar has contributed to some confusion among investors, even though management say it will help them focus on core products and growth.5-star Guggenheim analyst Jeff Cantwell clearly sees the light at the end of the current dark tunnel, as he reiterates a Buy rating and $80 price target on SQ stock. (To watch Cantwell's track record, click here)Cantwell held meetings with Square management, where he came away mostly positive but still "mixed.” He says the “Cash App opportunity seems significant,” but “seller business increasingly feels like it is in 'reboot' mode.” And while management believes the Caviar sale will help with core revenue focus, Cantwell believes the surprising sale “complicates matters as it precludes management from providing much-needed clarity on the outlook for '20E,” a main driver in other analysts’ pessimistic views. One of Cantwell’s most positive views is on the Cash App. The analyst says the app “stands out as a success” for Square and believes this can be a significant source of revenue and EPS over the long-term. But he also believes the product development “remains important given (valid) investor concerns related to the [long-term] sustainability of Cash App's Instant Deposit-related revenue stream.” On a more cautious note, Cantwell says “competition is impacting SQ's ability to grow GPV,” with Adyen recently signing longtime Square customer Joe & the Juice. As a result, the analyst sees Square “increasing spend to help counter rising competition from other high-quality payments companies.” Square’s shifting strategy appears to “be unsettling investors in the near-term,” but updated guidance and an Investor Day early next year “would give [Square the] opportunity to re-calibrate investor expectations for” the short-term.All in all, though some analysts are concerned about the short-term, Wall Street is generally bullish on Square stock. TipRanks analysis of 19 analyst ratings shows a consensus Moderate Buy, with nine analysts recommending Buy, six saying Hold and three suggesting Sell. The average price target of $78.88 represents a 34% upside from current levels. (See SQ's price targets and analyst ratings on TipRanks)
Square's lawsuit against San Francisco over taxes offers insight into why out-of-state economic recruiters eagerly court the company.
The last time I compared Twitter (NYSE:TWTR) to Square (NYSE:SQ) was 16 months ago in April 2018. At the time, I suggested that Square stock was a better buy than Twitter stock over the long haul because the payment processor solves more problems than the social media platform. Source: IgorGolovniov / Shutterstock.com Flash forward to today and TWTR stock is up 58% through Sept. 9 versus 34% for Square and 14% for the S&P 500.Jack Dorsey, CEO, and co-founder of Twitter and co-founder of Square has seen his personal wealth increase substantially over this period thanks to the performance of both stocks. InvestorPlace - Stock Market News, Stock Advice & Trading TipsNot only has Twitter outperformed over the past 16 months, but it's also up 54% year to date while Square's gained just 10% or about half the return of the total market. Does that make Twitter the better buy? I don't think so. Here's why. Valuations on Square Stock and Twitter StockAs I write this, Twitter stock is trading at 10.5 times sales, 62% higher than Square. However, TWTR's forward P/E of 40.2 is cheaper than 55 times Square's forward earnings, so answering which stock is cheaper is really a matter of personal preference. * 10 Stocks to Sell in Market-Cursed September Because Square is still losing money on a GAAP basis, I believe P/S one of the few metrics that allow for an apples-to-apples comparison. Now, when it comes to free cash flow, one of my favorite financial metrics for assessing a company's financial health, Square's is coming on like gangbusters. In the latest six months ended June 30, Square's free cash flow was $136 million, 183 higher than in the same period a year earlier. Meanwhile, Twitter's free cash flow was $475 million, 81% higher than the previous six months. It looks like a tie, doesn't it?To determine which company has a better free cash flow situation, let's look at both companies' free cash flow yields using their trailing 12-month free cash flows, divided by their current enterprise values. Square's free cash flow for the trailing 12 months is $321.7 million. That gives it an FCF yield of 1.3% based on an enterprise value of $25.6 billion. Twitter's free cash flow for the trailing 12 months is $1.1 billion. That gives it an FCF yield of 3.4% based on an enterprise value of $31.0 billion. From this perspective, Twitter appears to be the cheaper buy. What this doesn't take into consideration the rate at which Square is growing its revenue. In the past three years, Twitter has grown its revenue from $2.2 billion in 2015 to $3.04 billion in 2018, a compound annual growth rate of 11.4%. At the same, Square's grown its revenue from $1.27 billion in 2015 to $3.30 billion in 2018, a compound annual growth rate of 37.5%, more than three times Twitter's growth. Future Promise and Square StockAs Square continues to introduce innovative products such as Square Terminal outside the U.S., its international revenues will continue to blossom.I recently attended the Wolfville Farmers Market in Wolfville, Nova Scotia. About an hour's drive from Halifax, Wolfville is the heart of farm country in the province. Almost all of the stalls were using Square products to process payments. Here's what I said about Square Terminal in August:"At the Canadian launch of Square Terminal, Dorogusker, Square's head of hardware, told reporters that the portable terminal provides small- and medium-sized businesses with the ability to manage inventory, send invoices, record deposits, manage payment histories, and generate reports about their companies…The product eliminates the need for shopkeepers to deploy a slew of iPads, smartphones and tablets, to successfully operate their businesses."From where I sit, Square's innovation will continue to enable it to grow revenues by 30% or more on an annual basis, while Twitter's going to struggle to grow its ad revenues by double digits. For this reason, Square deserves a higher valuation than Twitter. However, let's assume Square has a P/S multiple identical to Twitter. That would give it a market cap of $42.5 billion, 62% higher than its current market cap. The Bottom Line on Square Stock and Twitter StockTwitter stock has bounced nicely in 2019. I'll give it that.However, as my InvestorPlace colleague, Luke Lango stated at the end of August, "Twitter stock looks risky above $40."I said Square was the better stock in April 2018 and it failed to keep up with Twitter. Over the next 16 months, I have no doubt, this time it will be different. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post Twitter's Been Hot, but Square Stock Still Is the Better Buy appeared first on InvestorPlace.
Square Inc (NYSE: SQ ) has taken a pounding in recent weeks and is now down 32% overall in the past year. Despite some impressive growth potential, one analyst said Wednesday slowing revenue trends and ...
If you just look at charts and don't pay any attention to monetary trends in the world, you might think that Square (NYSE:SQ) is going nowhere fast and that Square stock is destined to stay below $70 forever.Source: Jonathan Weiss / Shutterstock.com This is a textbook example of why I encourage investors to look beyond the charts and educate themselves about the macro environment.As I see it, the Square stock price will be driven not by technical indicators on the chart but by a bigger cultural movement away from cash and towards more convenient and easily accessible forms of payment. Square is a company at the forefront of this movement, and soon enough, SQ stock will reflect the true value of this forward-thinking point-of-sale solutions provider.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Say Good-Bye to Cash and Hello to SQ StockThe trend is unmistakable: consumers want convenience, not cash, in their payment modalities. As proof of this, consider the fact that for transactions totaling less than $20, consumers back in 2015 paid with cash 46% of the time. That's already less than half, but check this out: so far in 2019, that figure has fallen to 37%, marking a precipitous drop in cash-based spending. * 10 Stocks to Sell in Market-Cursed September This is a global phenomenon, with 47% of China's consumers using mobile wallets as their primary means of making payments. While PayPal (NASDAQ:PYPL) and Amazon (NASDAQ:AMZN) remain strong contenders in the global point-of-sale payments space, Square's user base is growing at a record clip: 15 million active accounts by the end of last year, more than double the 7 million at the end of 2017.What differentiates Square from the other competitors is the simplicity of the company's app, along with ease with which users can receive paychecks through Square Cash. Plus, shoppers enjoy the app's wide range of instant discounts, some of which are exclusive to Square Cash.I also like the move that Square made recently to unload its food delivery service, known as Caviar. This is a highly competitive market, and let's face it: food delivery isn't Square's forte. Therefore, when Square announced that it was selling off Caviar to Doordash for $410 million after having paid just $44.3 million for it five years ago, I found this to be a savvy move and a sign that Square is prepared to focus on its payments app. Analysts Are Taking a Shine to Square StockI try not to put too much stock (no pun intended) into analysts' expectations, but I just can't ignore the love that SQ stock has been getting lately. As an example, one analyst who foresees plenty of upside for SQ stock is KeyBanc's Josh Beck.Beck not only reaffirmed an overweight rating for the shares but even gave it a price target of $100 - pretty ambitious considering the all-time high for Square stock is $101.15."We outline a potential scenario where adj. revenue could come in at $562.5M, which could be driven by a subscription/services number closer to ~$250M," he said.Somewhat less ambitious but still optimistic are Andrew Jeffrey of SunTrust Robinson Humphrey, who gave SQ stock an upgrade from hold to buy along with a price objective of $80; as well as Argus Research analyst Stephen Biggar, who also granted Square stock a buy rating but furthermore assigned a very bullish price objective of $94 for SQ shares. The Takeaway on Square StockI'm not overly concerned about the day-to-day movements of the Square stock price, as I view SQ as a long-term investment in a world that's abandoning cash and moving towards payment methods that are simple and convenient - and Square is proving itself as a strong, focused, and fast-growing competitor in the point-of-sale payments domain.As of this writing, David Moadel did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post Ride Square Stock to the Top as the World Goes Cashless appeared first on InvestorPlace.
Square Inc. is suing the City of San Francisco to reduce its tax bill. The San Francisco Examiner reported Tuesday that the mobile payments company, which is based in the city, filed a lawsuit last week seeking a $1.27 million refund from its gross receipts taxes. A win by Square could also reduce its future tax payments. Square claims in the lawsuit that it is not a "financial services" company as the city claims, but an "information" company; "information" companies are taxed at a lower rate. Square also claims the city's application of the tax is unconstitutional, and that it was improperly taxed for money it was never in possession of. Square employs more than 2,000 workers in San Francisco, and CEO Jack Dorsey's other company, Twitter Inc. , received a hefty tax break to locate its headquarters in the city. Dorsey also opposed a ballot measure last year to tax companies' earnings in excess of $50 million to pay for homeless services, which voters overwhelmingly approved.
U.S. Bank said the software maker will be part of its newly formed digital team, which was created as part of the bank's "digital transformation."
JPMorgan Chase & Co. (NYSE: JPM ) is stepping up its digital payments game by offering free same-day deposits for its WePay customers. On Tuesday , WePay CEO Bill Clerico said by the end of 2019, all WePay ...
For the most part, growth stocks have had a really good 2019 as stabilizing global economic conditions have converged on plunging rates to create an ideal investment backdrop for long duration assets. The iShares S&P 500 Growth ETF (NYSEARCA:IVW) is up more than 20% year-to-date. But one growth stock that has come up short in the big 2019 rally is Square (NYSE:SQ) stock.Source: Jonathan Weiss / Shutterstock.com In 2019, SQ has struggled with competition concerns and slowing growth trends against the backdrop of a rich valuation -- a combination which has ultimately resulted in SQ stock rising only 12% year-to-date and being down 30% over the past year.Will the struggles in SQ stock continue? I don't think so. At $60, the long-term bull thesis on Square stock looks incredibly compelling from a fundamental valuation perspective. At the same time, the optics surrounding Square stock should improve over the next few months, and that improvement should inject confidence back into the investor base.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Industrial Stocks to Buy for a Strong U.S. Economy Net net, I think the fundamentals and optics underlying SQ stock lay the groundwork for a compelling reason to buy the stock at $60. Will it run higher immediately? Probably not. But does it have immense upside potential from here in a multi-quarter to multi-year window? Absolutely.As such, for investors who are willing to be patient, SQ stock looks like a great buy here. The Fundamentals Are Very AttractiveThe story on Square is pretty easy to understand. Everywhere, all across the globe, consumers are pivoting from cash to non-cash payment methods, such as card and digital payments. In order to keep up with this secular pivot, merchants, retailers, and restaurants everywhere need to adopt payment processors which handle all types of payments. Square sells these payment processors.So do a lot of other companies. But Square is differentiated in three big ways. First, they've built a software ecosystem surrounding their payment processors which helps merchants of all sizes modernize, digitize, and automate workflows. Second, they've built this ecosystem to be particularly advantageous for small-to-medium sized businesses who are often behind the curve on modernization and digitization. Third, their payment processors come in all shapes and sizes -- ranging from a mag-stripe smartphone attachment, to a full-on register -- so that merchants can sell whenever, wherever, and however they want.Thus, the core growth narrative here is that as cash increasingly becomes obsolete and card payment volume continues to grow, Square will leverage its unique advantages to grow relevance, reach, and share across the global retail world. That was a $24 trillion world back in 2018, of which Square only controlled about 0.35%. In the long run, then, Square has a tremendous opportunity to sustain 20%-plus revenue growth for a lot longer, which should drive healthy margin expansion through positive operating leverage.Zooming out, Square projects as a 20%-plus revenue grower into 2025, with sizable upside margin drivers. Net net, that paves a tangible pathway for EPS to $4 by 2025. Based on a payment processing average 30-times forward multiple and a 10% discount rate, that equates to a 2019 price target for SQ stock of $75. The Optics Will ImproveTo be sure, the fundamentals have pointed to a 2019 price target for SQ stock of $75 for some time now. Yet, Square stock has languished around $60 for over a month.Clearly, Square stock needs a catalyst outside of "it's undervalued" to shoot shares higher.That catalyst could come over the next few quarters as the optics surrounding the stock materially improve. This breaks down into three parts. First, I expect the broader financial market backdrop to improve over the next few months as trade tensions ease (neither side wants the trade war to escalate further), U.S. consumers spend big during the holiday season (everyone is working and making more), and rates remain low (inflation is muted everywhere). Click to EnlargeSecond, SQ stock is showing resilience at a multi-year support line narrowly above $60. The lower $60's have proven to be a "bottoming" area for Square stock twice before since mid-2018, breaking only once during the late 2018 stock market wipe-out. If Square stock does indeed hold this lower $60's level again, then technical traders will rush into the stock, and that will provide an upward lift for the stock.Third, I think the numbers will get better from here. Square's revenue growth has been decelerating recently, but it should stabilize over the new few quarters as new investments start to yield healthy returns. These investments include the roll-out of Orders API to help merchants manage order fulfillment, the build-out of the Cash App ecosystem, the launch of Square Terminal in Australia, operational expansion among bigger merchants, and more. Bottom Line on SQ StockIt's been a rough ride in SQ stock over the past year, But this turbulence is to be expected after SQ stock rallied about 700% from mid-2016 to mid-2018. * 10 Stocks to Buy for September In other words, in the big picture, the past 52 weeks of weakness in Square stock is a just a blip on the radar -- a minor consolidation period in a long-term uptrend. Importantly, the growth fundamentals here remain highly favorable, and because of such, SQ stock can and will move significantly higher in the long run.As of this writing, Luke Lango was long SQ. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 3 Artificial Intelligence Stocks to Buy * 7 Industrial Stocks to Buy for a Strong U.S. Economy * 3 Beaten-Down Bank Stocks to Buy and Hold for the Long Term The post 2 Big Reasons to Like Square Stock at $60 appeared first on InvestorPlace.