Block Valuation Case Hinges on Returns From Customer Campaigns
Simply Wall St’s analysis sees value above the share price, but says campaign spending must support the returns built into its estimates.
Key takeaways
- Simply Wall St’s model put Block’s share price at $75.23 when the article was published.
- The analysis says returns from customer campaigns are key to its valuation case.
Simply Wall St’s analysis said its Excess Returns model valued Block above the $75.23 share price cited in the article. The publisher said the valuation depends on whether customer acquisition efforts can sustain the returns assumed in its estimates.
The analysis pointed to Block’s “Bitcoin Does” campaign and discounts on Square point-of-sale hardware as spending that could affect returns on invested capital. Its model used an average return on equity of 12.23% and analyst projections including stable earnings per share of $5.48.
Separately, a community narrative highlighted by Simply Wall St described Block as 24% undervalued. The article also noted that Block’s shares had fallen 69.6% over five years.
This article was produced with the help of AI technology. Source: Yahoo Finance
