Shares of Square (SQ - Free Report) popped more than 3.4% in early morning trading Thursday after analysts from Credit Suisse upgraded the stock, citing the growing number of applications for its production offerings for merchants.
Credit Suisse raised its rating for Square to outperform from neutral. The firm also raised its price target for the stock to $81 from $44, which represents a 19% premium to Wednesday’s close.
“SQ’s evolution from a payment company to a differentiated consumer and merchant services platform increases our conviction that the company can extend its business well beyond micro-merchants to include SMB and middle-market companies,” wrote analyst Paul Condra in a note to clients Thursday.
Condra noted that Square’s growing product ecosystem is helping the company attract larger merchants, widening its payment opportunity while adding new subscription and service revenue outlets.
The analyst also mentioned that Square has added point-of-sale software for restaurants, new hardware, customer relationship management tools, and more to its product suite—all in addition to its traditional payments solution.
Credit Suisse estimates Square has only captured 3% to 4% of the $2 trillion in payment volume generated by small- to medium-sized businesses around the world, so there is plenty of room for growth. The firm is also bullish on Square’s opportunity in the cryptocurrency market.
“We view the core payment opportunity as very large,” Condra said. “We believe crypto currencies are not going away and expect that over time they are likely to find more applicable use cases. While this is a small opportunity currently, we view SQ as among a handful of companies - and the only public one - at the forefront of shaping the evolution of this industry.”
Squares shares had already added about 97% this year heading into today.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
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Shares of Square (SQ - Free Report) popped more than 3.4% in early morning trading Thursday after analysts from Credit Suisse upgraded the stock, citing the growing number of applications for its production offerings for merchants.
Credit Suisse raised its rating for Square to outperform from neutral. The firm also raised its price target for the stock to $81 from $44, which represents a 19% premium to Wednesday’s close.
“SQ’s evolution from a payment company to a differentiated consumer and merchant services platform increases our conviction that the company can extend its business well beyond micro-merchants to include SMB and middle-market companies,” wrote analyst Paul Condra in a note to clients Thursday.
Condra noted that Square’s growing product ecosystem is helping the company attract larger merchants, widening its payment opportunity while adding new subscription and service revenue outlets.
The analyst also mentioned that Square has added point-of-sale software for restaurants, new hardware, customer relationship management tools, and more to its product suite—all in addition to its traditional payments solution.
Credit Suisse estimates Square has only captured 3% to 4% of the $2 trillion in payment volume generated by small- to medium-sized businesses around the world, so there is plenty of room for growth. The firm is also bullish on Square’s opportunity in the cryptocurrency market.
“We view the core payment opportunity as very large,” Condra said. “We believe crypto currencies are not going away and expect that over time they are likely to find more applicable use cases. While this is a small opportunity currently, we view SQ as among a handful of companies - and the only public one - at the forefront of shaping the evolution of this industry.”
Squares shares had already added about 97% this year heading into today.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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