- Block, Inc Q Shares are trading higher today as it prepares to report results after the market close on Thursday.
- Block’s first-quarter results could prompt investors to jump into the payments company’s cash app business, according to claims from U.S. short seller Hindenburg Research. including excessive user counts.
- MorganStanley Analysts said in April that some bearish investors were unsure about the level of gross profit from “potential illegal activity” on the Cash App platform.
- Finally, bears suspect a significant gross profit could come under pressure if regulators crack down on Cash App, making it difficult to accept Cash App as a legitimate, trusted bank over the long term, Reuters quoted Morgan Stanley analysts.
- Block’s sales growth took a hit in recent quarters as inflationary pressures forced consumers to postpone large purchases.
- Hindenburg had accused Block of exaggerating its user counts by allowing fake or duplicate accounts on its cash app platform.
- Cash App reported 51 million monthly active customers as of December 31, including 44 million verified customers.
- Wall Street analysts expect Block to be more transparent about how it reports the number of users in the Cash App and address concerns flagged in the report, including weak KYC (know-your-customer) compliance.
- Price promotion: SQ shares traded 3.00% higher to $59.50 on the last check Wednesday.
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
[ad_2]
Source story
