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Square's earnings forecasts are lacking, stocks are flowing (SQ)

Jack Dorsey Square IPOREUTERS / Lucas Jackson

  • Square's shares fell after trading hours on Wednesday after the company released its fourth-quarter results.
  • the The mobile payment company led by Jack Dorsey reported earnings and revenue higher than expected.
  • The company also released lower-than-estimated first quarter earnings forecasts, reducing inventory by almost 6%.
  • Watch the Square Trade Live.

The shares of Square, the mobile payments company, lost Wednesday nearly 6% after the publication of the first quarter earnings forecast, below expectations.

Square reported adjusted earnings per share for the first quarter of $ 0.06 to $ 0.08, which is below the $ 0.12 expected by analysts.

Here is what Square reported, compared to what the analysts surveyed by Bloomberg expect.

  • Adjusted earnings per share (EPS): $ 0.14 against $ 0.14 expected.
  • Returned: $ 464 million against $ 454.6 million.

Wednesday's report was the first without longtime finance director Sarah Friar. His departure was announced for the first time last October, a development that ransacked the stock. Last month, the company appointed Amrita Ahuja, former leader of Activision Blizzard, to his position.

Prior to the results, James Friedman, an analyst at Susquehanna, told his clients that Square was continuing to innovate in the financial technology field and had reiterated its price target of $ 77 – about 2% lower than stock prices. merchant Wednesday.

Previously, Friedman had downgraded Square's equity rating from "positive" to "neutral" after the company had offered lower-than-expected earnings guidance. Nevertheless, Friedman is positive for the long run.

More generally, Wall Street's sentiment towards the company led by Jack Dorsey is divided between neutral and optimistic perspectives.

Of the analysts surveyed by Bloomberg, 17 say "buy", 15 say "hold" and only four say "sell".

Square shares jumped 190% from the beginning of 2018 to its record high of $ 101.14 in September. Currently, they are down 23% from their September peak.

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