Square Really Be a Growth Stock?

Square (NYSE: SQ) has had mixed results from its various affiliated businesses during the pandemic. The company's fourth-quarter earnings made its investors happy enough to continue to increase investment. But after the stock's recent volatility, can one be sure that Square has a growing share?

What is Square doing?

Square is a fintech (financial technology) company that operates a payment ecosystem. Despite the popular card reader's strong showcase presence in the market, it grew relatively slowly during the epidemic. Revenue increased 5 percent and gross profit increased 13 percent. The company invested in "Holistic Channel" operations to reach more customers and offer more options for showcasing. Following this, thanks to the holistic channel, the gross payment volume increased by a third, accounting for half of the overall revenue.

Square sees mid-sized businesses as an enormous marketplace.

This category has proven to have high profitability potential, as it achieves twice the gross profit growth of other categories. Cash App has been a huge success, causing people to start relying more on digital payments while they are in home quarantine.

But it was Bitcoin that made Square the biggest leap in its business. (CRYPTO: BTC).

The company's revenue grew 141 percent in the fourth quarter, without Bitcoin the increase was only 23 percent. In the fourth quarter, Cash App active customers reached 36 million, up 50 percent compared to the same period of 2019. Square's cost per acquisition was only $ 5, reflected in the reports. There are 80 million customers who have traded at least once in the Cash App system, and Square continues to create more value for their customers to stay loyal In the report announced for the fourth quarter, the gross profit per customer increased by 70 percent compared to the same period of the previous year, can be interpreted as the company may have found the key to more profitability. Bitcoin continues to become an increasingly important part of the Cash App. Bitcoin trading grew more than 250 percent compared to the same period of the previous year. Square made a $ 190 million purchase in the fourth quarter of Bitcoin, which it sees as the currency of the internet. As long as Bitcoin's price is flying, things are fine for the Cash App.   Assuming electronic payments are still in their infancy, Square is still in a high growth mode, especially with the Cash App product. The best indicator of growth is the ease of returning to new jobs quickly.

About Square stock price!

Square shares are at a shocking valuation, roughly 600 times, given its 12-month earnings. However, the company, which has rewarded its investors in the past, has earned more than 400 percent in the last three years. Given the bright future of the company, we can say that it can still continue to grow.   Square Really Be a Growth Stock? Source: https://www.fool.com/ You may also be interested in:

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