Jack Dorsey, co-founder and chief executive officer of Twitter Inc., speaks during an interview in New York, U.S., on Monday, May 1, 2017.
Michael Nagle | Bloomberg | Getty Images
Payments company Square is scheduled to report second-quarter earnings after the market close Thursday.
Here’s what Wall Street expects:
- Earnings: 17 cents per share, forecast by Refinitiv
- Revenue: $557.1 million, forecast by Refinitiv
Square‘s stock has been on a tear this year with a 47% rally since January, compared to a 20% rise in the S&P 500.
Last quarter, Square beat analysts’ estimates on earnings and revenue but reported weaker-than-expected gross payment volume and guidance for the second quarter.
The San Francisco-based company, run by Twitter CEO Jack Dorsey, is best known for its credit card processor, payment hardware and popular Cash App. Square also facilitates small business loans through Square Capital, and applied for a special industrial loan company license that allows less traditional financial firms to accept government-insured deposits.
Traders have bid up the stock thanks to new product launches, moves into e-commerce opportunities and growth in the Cash App — which is largely seen as a competitor to PayPal’s Venmo. It also launched a debit card for businesses in January.
The company moved into food delivery with its Caviar acquisition in 2014. Analysts will be looking for revenue upside from some of these newer products in addition to its core business of subscriptions and services. On the call Thursday, analysts will likely ask for insight into adoption of the Cash App.
One criticism of the payment company has been Square’s exposure to brick and mortar through its payment hardware, which largely caters to small businesses.
“To mitigate this, Square has increasingly focused on deploying an omni-channel offering, recently launching Square Online Store,” said Dan Dolev, executive director at Nomura, who has a “buy” rating on Square and sees potential 40% upside for the stock. He expects “buoyant” commentary about Square’s shift to e-commerce.
— This is breaking news. Please check back for updates.
