Fintech specialist Square (NYSE:SQ) has received a less-than-warm reception from many analysts regarding its recently announced Square Installments consumer lending initiative. Separately, it was revealed that CEO Jack Dorsey had sold more than 103,000 shares of the stock.

This combination of news has caused Square's stock to retreat by about 15% from its recent high. Is it time to buy, or should investors stay away? Host Jason Moser and Fool.com contributor Matthew Frankel, CFP, discuss all this and more in this clip from Industry Focus: Financials.

A full transcript follows the video.

This video was recorded on Oct. 8, 2018.

Jason Moser: Let's talk about Square. A couple of things out there. One thing, I'd seen they were dabbling in this and it was probably going to become something they would pursue. They're now letting customers pay in installments. They've essentially introduced a new payment option for their small business partners, in order to let customers pay for larger purchases in monthly installments. Larger purchases, I believe the number qualifies anywhere from $250 to $10,000. It's not like just anybody can do it whenever they want. You have to actually be able to qualify for it. But it does sound like yet another option Square is offering its merchant partners. Sounds like they're giving them that option in order to be able to really meet their customers' demands wherever and however they need.

Matt Frankel: Yeah, definitely. I have mixed feelings about this move. For one, it's a long-awaited first step into consumer lending for Square. When we were talking about the Square Cash app, we mentioned that's one of their big, long-tail opportunities, to eventually monetize that base with loans. On the other hand, what they're doing is essentially what most store credit cards do with their 0% financing offers. To be clear, Square's isn't always 0%. It ranges from 0-24% APR depending on the credit profile of the borrowers. But my point is, with store credit cards, those are some of the highest default rates in the credit card industry. If you look at say, Synchrony Bank, which is a big issuer of store credit cards, their default rate is about twice what AmEx's is. So, this adds a big element of credit risk to Square, which I think is why you saw a little bit of a negative reaction in the stock after they announced this.

But in the long run, I think this is really good for the business. It adds an element of risk, but it's definitely welcome news to people like me, who have wanted to see them dip their toes into the consumer lending space.

Matt Moser: As a shareholder, I see what you're saying there. I saw the news and I wasn't quite sure how to feel about it at first. It does add that element of risk that so many companies before have not executed as well on. But I think also, the encouraging part is, at least with Square, most everything they do is built on the data that they get from their hardware and software systems that their merchants use. Assuming that they are doing what they say they're doing, and using this data to make these decisions, perhaps that is going to prove to be a bet that pays off down the road. Certainly, it's a very long-term oriented type of bet there.

Now, we also have seen today Square shares are in the tank. That is because of a little news we saw earlier that, frankly, I don't think is all that big of a deal. What do you think?

Frankel: What happened was CEO Jack Dorsey exercised some options at the end of the day Friday and sold about 103,000 shares of Square. He got between $95-$98, I want to say, for his shares. Generally, when a CEO starts unloading shares, it's a negative. But the company put out a press release. It's very important to remember this was a pre-planned sale. They stress that it does not reflect how Dorsey feels about the company or the stock's valuation or anything to that effect.

Generally, when this happens, we consider this a buying opportunity. It's generally, in the long-term, in the long context of things, a non-event. It's down about 11% today. We were just talking before this that if we were allowed to buy some today, we might. Don't panic and sell. That's the last thing you want to do.

Moser: Yeah. I feel like that old Peter Lynch saying, there are a million reasons to sell and really only one reason to buy. I never hold selling against anyone, because that's part of compensation. And as a planned sale, it matters even less. I've always found insider selling to be much more of a non-event than I think a lot of the financial headlines would have you believe. And, jeez, if we didn't have these trading restrictions, I certainly would be thinking very, very long and hard about adding to my position. And I still may. You never know, maybe I'll shut up about Square for the rest of the week here, so I can at least have the choice.

Jason Moser owns shares of Square. Matthew Frankel, CFP owns shares of AXP and Square and has the following options: short December 2018 $90 calls on Square. The Motley Fool owns shares of and recommends Square. The Motley Fool has the following options: short January 2019 $80 calls on Square. The Motley Fool has a disclosure policy.