Block, Inc.
Block, Inc. Fundamental Analysis
Block, Inc. (SQ3.F) shows moderate financial fundamentals with a PE ratio of 27.60, profit margin of 5.40%, and ROE of 5.91%. The company generates $24.3B in annual revenue with strong year-over-year growth of 10.06%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 51.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze SQ3.F's fundamental strength across five key dimensions:
Efficiency Score
WeakSQ3.F struggles to generate sufficient returns from assets.
Valuation Score
ModerateSQ3.F shows balanced valuation metrics.
Growth Score
ExcellentSQ3.F delivers strong and consistent growth momentum.
Financial Health Score
ExcellentSQ3.F maintains a strong and stable balance sheet.
Profitability Score
WeakSQ3.F struggles to sustain strong margins.
Key Financial Metrics
Is SQ3.F Expensive or Cheap?
P/E Ratio
SQ3.F trades at 27.60 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, SQ3.F's PEG of -0.41 indicates potential undervaluation.
Price to Book
The market values Block, Inc. at 1.62 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 10.90 times EBITDA. This signals the market has high growth expectations.
How Well Does SQ3.F Make Money?
Net Profit Margin
For every $100 in sales, Block, Inc. keeps $5.40 as profit after all expenses.
Operating Margin
Core operations generate 9.87 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $5.91 in profit for every $100 of shareholder equity.
ROA
Block, Inc. generates $3.30 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Block, Inc. produces operating cash flow of $2.59B, showing steady but balanced cash generation.
Free Cash Flow
Block, Inc. generates strong free cash flow of $2.44B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $4.00 in free cash annually.
FCF Yield
SQ3.F converts 6.69% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
27.60
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.41
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.62
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.50
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.42
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.20
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.06
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.08
vs 25 benchmark
How SQ3.F Stacks Against Its Sector Peers
| Metric | SQ3.F Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 27.60 | 33.94 | Better (Cheaper) |
| ROE | 5.91% | 1002.00% | Weak |
| Net Margin | 5.40% | -48794.00% (disorted) | Weak |
| Debt/Equity | 0.42 | 0.44 | Neutral |
| Current Ratio | 2.20 | 5.74 | Strong Liquidity |
| ROA | 3.30% | -288341.00% (disorted) | Weak |
SQ3.F outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Block, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
252.50%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
431.52%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
258.96%
Industry Style: Growth, Innovation, High Beta
High Growth