From Financial Modeling Prep: 2025-06-02 16:08:00

Truist Securities initiated coverage on Block (NYSE:XYZ) with a Sell rating and a $60 price target, citing growing headwinds in a late-cycle economic environment. Concerns were raised about the sensitivity of Square and Cash App to economic downturns, with potential vulnerability in core small business and lower-income consumer segments.

Increased risk was highlighted from Block’s recent foray into lending, including Cash App Borrow and Afterpay services. This strategy to reignite growth through 2025 may raise credit loss exposure and pose challenges for 2026 comparisons. Limited flexibility to cut operating expenses could further impact profitability in deteriorating economic conditions.

Truist believes Block may struggle to manage profitability if economic conditions worsen, leading to underperformance compared to peers in the near term. Despite acknowledging Block’s long-term potential, caution is advised due to potential challenges faced by the fintech firm in the current economic climate.



Read more at Financial Modeling Prep:: Truist Starts Block at Sell, Flags Macro Risks and…