Deutsche lists 7 ways for Block to get shares materially higher

Deutsche Bank analyst Bryan Keane laid out steps for Block to deliver near-term shareholder value. Despite strong fundamentals, the company’s shares have materially underperformed, the analyst tells investors in a research note titled “How Can Block Get Its Mojo Back.” In this market, companies that can beat on sales or deliver material sustainable upside on EBITDA are getting rewarded, and Block has the ability to drive outperformance on both the top and bottom line, says the firm. Deutsche believes Block will continue to take market share in its major business segments and finds the shares attractively valued. It says the company “is at the forefront of emerging payment trends.” The firm sees seven things that can be done to get the shares to appreciate materially: set mid-term gross profit expectations, pass through EBITDA beats, drive Square volumes above industry, deliver outperformance in Cash App, continue Afterpay’s rebound, highlight new sources of revenues in discovery and check-out, and “be transparent.” Deutsche Bank keeps a Buy rating on Block with a $95 price target.