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    Block (SQ) Is Up 6.0% After $5 Billion Buyback Expansion And 2026 Profitability Targets - What's Changed

    Simply Wall St·12/14/2025 05:32:15
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    • Recently, Block expanded its share repurchase authorization by US$5.00 billion and reaffirmed its outlook for strong Q4 2025 gross profit and adjusted operating income growth across the Square and Cash App ecosystems.
    • The company also issued longer-term guidance, including a goal to reach the “Rule of 40” in 2026, which underlines management’s confidence in sustained growth and profitability.
    • Next, we’ll explore how this expanded US$5.00 billion buyback program may reshape Block’s existing investment narrative around margin expansion.

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    Block Investment Narrative Recap

    To own Block, you need to believe its two-sided ecosystem of Square and Cash App can keep compounding users, volume, and monetization while moving steadily toward higher, more durable margins. The expanded US$5.00 billion buyback does not change the near term catalyst, which still hinges on Block delivering the reaffirmed Q4 2025 gross profit and adjusted operating income outlook, nor does it remove the key risk that competition and slowing engagement in Cash App could pressure growth.

    Among recent updates, the enlarged US$9.00 billion repurchase authorization stands out, given the stock’s pullback and Block’s focus on margin expansion. By reducing share count while reiterating its path toward the “Rule of 40” in 2026, management is tying capital returns more closely to its profitability ambitions around Cash App and Square, which could amplify both the upside and the sensitivity of returns to execution on those margin and growth targets.

    Yet investors should also weigh how rising competition in peer to peer payments and consumer finance could quietly undercut the very Cash App growth that this thesis relies on...

    Read the full narrative on Block (it's free!)

    Block’s narrative projects $32.8 billion revenue and $2.4 billion earnings by 2028.

    Uncover how Block's forecasts yield a $84.01 fair value, a 30% upside to its current price.

    Exploring Other Perspectives

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    Sixteen members of the Simply Wall St Community currently see Block’s fair value anywhere between about US$56.85 and US$103, reflecting very different return expectations. Against that backdrop, the enlarged US$9.00 billion buyback and management’s focus on achieving the Rule of 40 in 2026 give you another lens to compare those views with Block’s own margin and growth ambitions.

    Explore 16 other fair value estimates on Block - why the stock might be worth 12% less than the current price!

    Build Your Own Block Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

    • A great starting point for your Block research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
    • Our free Block research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Block's overall financial health at a glance.

    Ready For A Different Approach?

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.