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Will Square's (SQ) Q3 Earnings Gain on Portfolio Strength?

Zacks Equity Research

Square, Inc. SQ is set to report third-quarter 2019 results on Nov 6.

The company’s robust financial services offering are likely to have contributed to the third-quarter performance.

Moreover, its friendly ecosystem that enables sellers to combine software, hardware and payments services in order to accept payment from the customers, is expected to have helped it in maintaining solid momentum across sellers.

All these factors are likely to have driven Square’s Gross Payment Volume (GPV) in the third quarter.

The Zacks Consensus Estimate for GPV for third quarter is currently projected at $27.9 billion, suggesting growth of 24.2% from the year-ago actual figure.

Click here to know how the company’s overall third-quarter performance is likely to be.

Square, Inc. Revenue (TTM)


Square, Inc. Revenue (TTM)

Square, Inc. revenue-ttm | Square, Inc. Quote

Strong Portfolio to Aid Growth

Square’s portfolio strength is anticipated to get reflected in the third-quarter results.

The company’s expanding omni-channel offerings, which aid sellers in managing their orders from the point of sale and eliminate manual aggregation of online and in-person orders, are expected to have strengthened seller base in the third quarter.

Further, Square’s strong product lines such as Square Invoices, Square Terminal, Instant Deposits, Cash Card, Square Register, Caviar, Square Reader, Square Stand, Square for Restaurant and API platforms are likely to have driven the third-quarter top line.

Additionally, product integrations are likely to have benefited Square’s performance in the quarter under review. New Order Manager that enables integration of delivery apps with strategic partners, is expected to have helped the company in attracting new sellers to its platform.

Further, Square for Restaurants, which integrates with more than 20 delivery platforms, including Caviar, DoorDash and Postmates, is expected to have driven the company’s GPV from food and drink vertical in the third quarter.

Improving business loan processing via Square Capital is also anticipated to get reflected in the third-quarter results. Additionally, growing adoption of Cash App in the bitcoin space is likely to have aided growth in Square’s bitcoin revenues.

All the abovementioned products are likely to get reflected in the company’s third-quarter revenues.

Zacks Rank & Other Stocks to Consider

Currently, Square sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the broader technology sector are Alteryx, Inc. AYX, Zendesk, Inc. ZEN and CommVault Systems, Inc. CVLT. All the three stocks flaunt a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Alteryx, Zendesk and CommVault is currently pegged at 39.85%, 29.52% and 10%, respectively.

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Square, Inc. (SQ) : Free Stock Analysis Report
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