Square beat fourth quarter earnings estimates, but lagged behind analysts' expectations on first quarter guidance.
The merchant services aggregator & mobile payments company, co-founded by Twitter CEO Jack Dorsey, reported adjusted earnings of 14 cents per share for the fourth quarter, which exceeded analysts’ expectations of 13 cents a share (based on Refinitiv data). The earnings-per-share were also higher compared to the year-ago quarter, by 6 cents.
Adjusted revenue for the quarter surged +64% year-over-year to $464 million, compared to analysts’ estimates of $454 million (based on Refinitiv data). Sales from subscriptions and services in the quarter was $194 million, a +144% jump from a year earlier. Another major win for the company came in the form of its peer-to-peer Cash App’s monthly active customer count doubling from a year earlier to reach more than 15 million in December 2018.
However, the company’s outlook on the upcoming first quarter earnings fell short of analysts’ expectations. Square predicts earnings to range between 6 to 8 cents per share, while analysts’ expected 11 cents a share.
On the other hand, the company’s adjusted revenue guidance for the first-quarter is between $472 to $482 million – not too far off of analysts' estimates of $474 million.
Square shares dropped -3.9% Thursday morning.
The 10-day moving average for SQ crossed bullishly above the 50-day moving average on February 27, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 14 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on March 28, 2024. You may want to consider a long position or call options on SQ as a result. In of 79 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
SQ moved above its 50-day moving average on February 23, 2024 date and that indicates a change from a downward trend to an upward trend.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SQ advanced for three days, in of 323 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 265 cases where SQ Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The 10-day RSI Indicator for SQ moved out of overbought territory on March 14, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 35 similar instances where the indicator moved out of overbought territory. In of the 35 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 59 cases where SQ's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for SQ turned negative on March 19, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SQ declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
SQ broke above its upper Bollinger Band on March 13, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. SQ’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.786) is normal, around the industry mean (28.564). SQ's P/E Ratio (4229.000) is considerably higher than the industry average of (146.896). Projected Growth (PEG Ratio) (1.294) is also within normal values, averaging (2.776). Dividend Yield (0.000) settles around the average of (0.085) among similar stocks. P/S Ratio (2.370) is also within normal values, averaging (77.699).
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. SQ’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 89, placing this stock worse than average.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a provider of credit card reader solutions for mobile devices
Industry PackagedSoftware