Please ensure Javascript is enabled for purposes of website accessibility

Is it Time to Sell Square Stock?

By Neil Rozenbaum - Updated Mar 12, 2021 at 6:19PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Square recently reported earnings. Here's why I'm not impressed.

In this video, I will be going over Square's (SQ -3.22%) fourth-quarter earnings report, and explain why it disappointed me.

Square's Q4 EPS (earnings per share) was $0.32 compared to analyst predictions of $0.24, with revenue of $3.16 billion beating estimates of $3.09 billion. The company also announced that it invested another $170 million in Bitcoin, which now constitutes approximately 5% of the total cash and equivalents on Square's balance sheet.

Notably, Cash App keeps growing; it generated gross profit of $377 million, up 162% year over year. Square did show that it can acquire customers for less than $5 each (which is unseen in the fintech world). Its seller side also grew year over year, which is impressive, since it was hit particularly hard by the pandemic. So Square might be a good recovery play.

 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Block, Inc. Stock Quote
Block, Inc.
SQ
$82.06 (-3.22%) $-2.73
Bitcoin Stock Quote
Bitcoin
BTC
$29,127.23 (-3.02%) $-906.07

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
349%
 
S&P 500 Returns
122%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/19/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.