Cathie Wood is Buying These 5 Stocks in September

2. Block, Inc. (NYSE:SQ)

Number of Hedge Fund Holders: 72

Block, Inc. (NYSE:SQ) is a California-based payments technology company. Cathie Wood has held a position in Block, Inc. (NYSE:SQ) since the last quarter of 2016. In September, ARK Innovation ETF added a further 222,799 shares of Block, Inc. (NYSE:SQ) to its portfolio. The latest purchase was made on September 16. 

Evercore ISI analyst David Togut on September 14 double downgraded Block, Inc. (NYSE:SQ) to Underperform from Outperform, slashing the price target to $55 from $120. The analyst sees “growing headwinds” to the company’s Seller and Buy Now Pay Later businesses, on the back of aggressive competition, tightening credit, and an anticipated slowdown in macroeconomic growth. The analyst lowered 2023 gross profit estimates by 9% to $7 billion, which is 5% below the Street consensus.

According to Insider Monkey’s data, 72 hedge funds were bullish on Block, Inc. (NYSE:SQ) at the end of Q2 2022, compared to 84 funds in the last quarter. Brian Bares’ Bares Capital Management is the largest stakeholder of the company, with 6.6 million shares worth $408 million. 

Here is what Baron Fintech Fund has to say about Block, Inc. (NYSE:SQ) in its Q2 2022 investor letter:

“Block, Inc. 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.”