Block's Favorable Q1 Outlook
- Potential for share expansion if 2026 targets met
- Q1 adjusted EBITDA likely at high end of guidance
Block, Inc's outlook is currently viewed as 'favorable' with an 'attractive opportunity' ahead of its Q1 results. The company's gross profit for the first quarter is expected to align with forecasts. If Block achieves its 2026 'Rule of 40' targets, there could be a significant expansion in shares.
Analysts have reiterated a Buy rating on Block, Inc, with expectations of substantial multiple expansion if the company meets its 2026 targets. The first-quarter results are anticipated to be in-line or better, and the estimates for the second quarter appear reasonable.
In the previous quarter, Block projected a minimum of 15% gross profit growth for 2024. Given the ongoing cost control, there is potential for an upward revision in the profitability outlook. With continued discipline in operating expenses, Block's adjusted EBITDA for the first quarter is likely to be at the high end of its guidance.