Financial technology company Square (SQ 3.38%) has seen impressive momentum in recent years, with revenue growth accelerating for six quarters in a row as of the company's third-quarter earnings release last year. Of course, such staggering growth in recent quarters has raised the bar for the company. Can Square keep up this momentum?

One key catalyst that looks like it continues to perform well for the company is its Cash App. Indeed, the peer-to-peer payment app is seeing more downloads than PayPal Holdings(PYPL 0.47%) popular Venmo, according to Nomura Instinet analyst Dan Dolev. 

A man using the Square Cash App

Cash App. Image source: Square.

Cash App vs. Venmo

"Our January payments app tracker shows Cash App monthly downloads remained elevated at [2 million] new downloads per month, up from an average of [1.9 million] in 2018," Dolev wrote in a note to clients on Tuesday. Highlighting how impressive downloads at this level are, this compares with 1.4 million downloads for Venmo in January, according to Instinet's payments-app tracker.

Cash App's downloads also exceeded Venmo's total downloads in 2018, according to Dolev. In 2018, Cash App downloads were 22.8 million, and Venmo downloads were 16.2 million, Instinet's tracker estimates.

The result of Cash App's outsize growth in downloads compared with Venmo's is a record spread between the two apps' cumulative downloads: 45.3 million for Cash App and 41.2 million for Venmo, Dolev notes.

Late last month, Dolev increased his 12-month price target on Square stock from $108 to $110, citing optimism for the company's new business debit card. The analyst maintained his $110 price target in his note on Tuesday.

A powerful catalyst

Square is treating the app as the hub of a larger ecosystem for consumer financial products. The company debuted a consumer-facing debit card, called Cash Card, to go along with the peer-to-peer payment app in 2017. Furthermore, CEO Jack Dorsey has said people are using the Cash App as they would a bank account -- storing money, directly depositing paychecks, spending, and withdrawing at ATMs.

Executives are particularly optimistic about the Cash Card, which connects to the Cash App ecosystem. "So, the Cash Card has been a pretty important driver for us," Dorsey said in the company's third-quarter earnings call.

Check out all our earnings call transcripts.

PayPal captured the big opportunity for payment apps in its most recent quarterly update. Total payment volume on Venmo surged 80% year over year in Q4 to $19 billion. In addition, PayPal management said the app is about one or two quarters away from breakeven, meaning the app may begin contributing to profitability soon.

Continued strong growth in Cash App downloads bodes well for the app's potential to morph into a meaningful growth driver -- not just for Square's revenue, but eventually for its profits, too.