What happened
The stock market had a muted open on Friday, with all three major averages hovering near the flatline shortly after the opening bell. But Block (SQ 2.33%), better known as Square, was a major outperformer. By 9:45 a.m. ET, shares of the fintech giant had climbed by more than 5%.
So what
Block is rising today thanks to not one but two major analyst upgrades.
Image source: Block.
First, an analyst with Bank of America upgraded Block from neutral to buy and placed a $185 price target on the stock. This implies about 60% upside on the stock, even after today's move.
Shortly after that action, a Wedbush analyst announced that it would maintain its neutral rating on the stock with a $140 price target. This was a slightly less optimistic take, with the analyst specifically calling out concerns about the recently acquired Afterpay buy now, pay later business. But it still implies a significantly higher potential stock price than shares currently trade for.
Now what
To be sure, it's wise to take any analyst actions with a big grain of salt. However, with the stock down by nearly 60% from its 2021 high, it's not surprising that some analysts are taking notice of Block as a potential value play at these levels. With the company set to report its latest results on Feb. 24, we'll get a little more clarity about how the underlying business is doing. If the company keeps delivering strong growth, the recent decline could indeed be an opportunity to buy.
