BofA Trims Block (XYZ) PT After Consumer Finance Sector Review

Block Inc. (NYSE:XYZ) is one of the best growth stocks to buy in 2026. On December 16, Bank of America analyst Mihir Bhatia lowered the firm’s price target on Block to $86 from $88 and kept a Buy rating on the shares. This sentiment was announced after BofA adjusted estimates among the firm’s overall consumer finance coverage following pre-quiet period IR catchups.

Earlier on November 21, Morgan Stanley raised the firm’s price target on Block to $72 from $71 with an Equal Weight rating on the shares. The decision followed the company’s investor day, where it met anticipated gross profit targets through improvements in the Square and Cash App segments. While Morgan Stanley is now more optimistic about product developments and increased share buybacks, the firm continues to view Bitcoin and ecosystem integration as low-return investments.

In Q3 2025, Block highlighted an 18% year-over-year increase in gross profit to $2.66 billion. While the company missed analyst expectations for revenue by $196.93 million (totaling $6.11 billion) and adjusted EPS by $0.12 (totaling $0.54), it demonstrated strong operational momentum, particularly within the Cash App ecosystem. Cash App’s gross profit surged 24%, driven by increased user engagement and the scaling of high-margin financial services.

The Square segment reported a 9% increase in gross profit, supported by a 12% rise in Gross Payment Volume/GPV. Growth was particularly strong in international markets, which saw a 26% GPV increase, and among mid-market sellers, who now account for 45% of total GPV.

Block Inc. (NYSE:XYZ), together with its subsidiaries, builds ecosystems focused on commerce and financial products and services in the US and internationally. It operates through two segments: Square and Cash App.

While we acknowledge the potential of XYZ as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.