Shares of payment processor Square (SQ -3.79%) jumped 24.5% in May, according to data provided by S&P Global Market Intelligence, as investors bet on an economic recovery. In the first week of trading in June, shares were up another 10.9%.
The biggest news coming from Square was its first-quarter earnings report, released early in May. The company reported a 44% increase in total revenue to $1.38 billion and adjusted EBITDA of $9 million, down 85% from a year ago. But the company's growth was impressive given that businesses were starting to shut down toward the end of the quarter and Square offered discounts for some services.
Investors were also betting on a quick economic recovery, pushing the entire market sharply higher in May. And as a tech favorite, it's not surprising Square's shares were among the best performers on the market.
Square is in an interesting position, benefiting from some of the moves to mobile payments and takeout orders and suffering from business shutdowns due to COVID-19. So the company should benefit from the reopening of the economy across the U.S. that's happening today. At the end of the day, this is still a great growth stock; it just may have some lumpy results as businesses adapt to a new way of operating in 2020.