I believe $Block(SQ)$ is deeply undervalued and already priced for recession trading for just over 5x gross profit (EV/GP), which is *cheaper* than rivals $PayPal(PYPL)$ $Rivian Automotive, Inc.(RIVN)$ despite compounding at over 30% per annum with the Square/CashApp ecosystem. This is a high-conviction long at $65.
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That is precisely what they are doing: the company isn't optimized for EBIT, yet, as they were focused on building the business. So GAAP EBIT is understated. But that will change beginning this year, with the focus on delivering the Rule of 40. The trend has already begun.
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- WG1·2023-06-20好的LikeReport