5 Best Blockchain Stocks To Buy Now

4. Block, Inc. (NYSE:SQ)

Number of Hedge Fund Holders: 75

Block, Inc. (NYSE:SQ), a California-based payments technology firm, was renamed from Square to Block in part to reflect its broader plans around crypto and blockchain. Over the Black Friday and Cyber Monday weekend, Block, Inc. (NYSE:SQ)’s Square and Afterpay sellers recorded more than 61 million transactions as consumers globally headed into the holiday shopping season. 

On November 16, Mizuho analyst Dan Dolev raised the price target on Block, Inc. (NYSE:SQ) to $69 from $57 and reiterated a Neutral rating on the shares. The analyst said payday lending is largely meaningful to Cash App gross profit growth. Payday lending is a short-term boost to inflows, but it may ultimately pressure Block, Inc. (NYSE:SQ)’s multiple as delinquencies across consumer lending continue to increase, the analyst told investors. This is concerning given Cash App’s skew towards lower-income households, added the analyst.

According to Insider Monkey’s third quarter database, 75 hedge funds were long Block, Inc. (NYSE:SQ), compared to 72 funds in the prior quarter. Cathie Wood’s ARK Investment Management is the biggest position holder in the company, with more than 9 million shares worth $505.45 million. 

In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Block, Inc. (NYSE:SQ) was one of them. Here is what the fund said:

“Block, Inc. (NYSE:SQ) provides point-of-sale technology to small businesses and operates the Cash App ecosystem of financial services for individuals. Shares fell due to mixed quarterly results with more modest growth in the Seller business offsetting strength in Cash App. While integration of recently acquired Afterpay is progressing well and credit metrics remain healthy, the buy-now-pay-later business slowed due to greater competitive intensity. We continue to own the stock due to Block’s long runway for growth, sustainable competitive advantages, and unique corporate culture.”

Given this cash-generation power, we are naturally drawn to what we believe are strong and profitable financial institutions when the price is right. Presently, we believe the valuations of our financial holdings are not only reasonable, but extremely compelling, and our portfolio composition reflects this view. Representative financial holdings in the Fund include Wells Fargo.”