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Block (SQ) to Report Q2 Earnings: What's in the Cards?

Zacks Equity Research
·4-min read

Block, Inc. SQ is scheduled to report second-quarter 2022 results on Aug 4.

For the second quarter, the Zacks Consensus Estimate for revenues is pegged at $4.33 billion, suggesting a decline of 7.5% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for second-quarter earnings is pegged at 18 cents per share, suggesting a fall of 72.7% from the year-ago reported figure.

The company surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same once, delivering an earnings surprise of 48.9%, on average.

Block, Inc. Price and EPS Surprise

 

Block, Inc. Price and EPS Surprise
Block, Inc. Price and EPS Surprise

Block, Inc. price-eps-surprise | Block, Inc. Quote

Factors at Play

Block’s portfolio strength is anticipated to get reflected in second-quarter results.

In the to-be-reported quarter, the company acquired GoParrot to expand its portfolio offerings and gain traction among restaurants in the United States, Canada, Australia and the U.K.

Block unveiled an integrated countertop point-of-sale (POS) solution named Square Register in Ireland to expand its reach in the country.

The company introduced Square Loans in Canada. This is expected to have expanded Block's reach to the small businesses of the country by offering them quick access to funds.

Block unveiled the next generation of Square Stand globally in order to expand its reach to online businesses.

The company’s Afterpay teamed up with Rite Aid to offer 'buy now, pay later' payment option to the latter's online customers.

All these endeavors are likely to have benefited the second-quarter performance of Block.

Apart from these, the company’s strong omni-channel offerings, which aid sellers in managing orders from POS, and eliminating manual aggregation of online and in-person orders, are expected to have contributed well.

Strength in online channels, including Square Online, Invoices, Virtual Terminal and eCommerce API, is likely to have aided growth in card-not-present payment volumes.

The increasing adoption of Cash App is likely to have aided growth in Block’s gross payment volume in the quarter under review.

However, uncertainties related to the pandemic are anticipated to have been concerning.

A slowdown in bitcoin trading activities is likely to have acted as a major headwind. Also, increasing advertising and personnel costs are anticipated to have weighed on the profitability of the company.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Block this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Block has an Earnings ESP of -13.3% and a Zacks Rank #3.

Stocks to Consider

Here are some stocks that you may consider as our model shows that these have the right combination of elements to beat on earnings this season.

Keysight Technologies KEYS has an Earnings ESP of +1.23% and a Zacks Rank # 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Keysight Technologies is scheduled to release third-quarter fiscal 2022 results on Aug 17. The Zacks Consensus Estimate for KEYS’ earnings is pegged at $1.79 per share, suggesting an increase of 16.2% from the prior-year fiscal quarter’s reported figure.

Amcor AMCR has an Earnings ESP of +1.39% and a Zacks Rank of 3 at present.

Amcor is set to report fourth-quarter fiscal 2022 results on Aug 16. The Zacks Consensus Estimate for AMCR’s earnings is pegged at 24 cents per share, suggesting an increase of 4.35% from the prior-year fiscal period’s reported figure.

Box BOX has an Earnings ESP of +1.20% and a Zacks Rank #3 at present.

Box is scheduled to release second-quarter 2022 results on Aug 24. The Zacks Consensus Estimate for BOX’s earnings is pegged at 28 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Keysight Technologies Inc. (KEYS) : Free Stock Analysis Report
 
Box, Inc. (BOX) : Free Stock Analysis Report
 
Block, Inc. (SQ) : Free Stock Analysis Report
 
Amcor PLC (AMCR) : Free Stock Analysis Report
 
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Zacks Investment Research