What happened
Who's afraid of an analyst price target cut or downgrade?
Apparently not Block (SQ -1.57%) investors, who in Tuesday afternoon trading were showing their company plenty of love despite bearish new analyst notes. The high-profile fintech's shares were up by nearly 3%, outpacing the slightly over 2% rise of the S&P 500 index.
So what
Before market open on Tuesday, Macquarie prognosticator Paul Golding downshifted his recommendation to neutral; previously he rated it an outperform (buy, in other words).
He also took a broadsword to his price target, slicing it in half and then some to $64 per share from the preceding $140. Golding cited macroeconomic concerns and high valuations as reasons for his move.
Not to be outdone, later in the day two other analysts also cut their Block price targets. Jamie Friedman from Susquehanna now feels the stock is worth $100 per share (previous target: $160), yet he's maintaining his positive (read: buy) recommendation on the shares.
Ditto for Canaccord Genuity's Joseph Vafi, who in keeping his buy tag on Block is nevertheless reducing his price target to $150 from the former $210.
Now what
Yet sometimes investor sentiment is too strong to change. Since Monday fintech stocks have been on a bit of a roll, thanks in no small part to better-than-expected earnings reports from banks in recent days. Banks and fintechs, of course, swim in the same finance-sector waters, so what's good for one is often also good for the other.
Besides, the fintech sector has been rather beaten-down lately, and many were eager for some good news to hit the industry. We'll see if today's bounce can last for titles in the sector, particularly Block.
