To The Moon

$Block(SQ)$'s recent earnings report was a breath of fresh air, exceeding analyst expectations and sending the stock price soaring in after-hours trading. As an trader who thrives on opportunity, I saw the pre-earnings dip triggered by the federal probe as a potential buying opportunity, and thankfully, my gamble paid off with my $SQ 20240503 74.0 CALL$.

Block's first-quarter results were impressive across the board. They not only surpassed analysts' estimates on both EPS and revenue, but also showcased significant year-over-year growth in gross profit, particularly within their Cash App business. This financial strength is a major reason for my bullish stance on the company.

The continued rise of Cash App users and their spending activity highlights the app's crucial role in Block's future. The 25% jump in Cash App gross profit year-over-year is a testament to its ongoing success. Block's commitment to integrating Afterpay further expands their reach and offerings within the growing fintech space.

While some may question Block's focus on Bitcoin, I see it as a strategic long-term play. As Dorsey mentioned, Bitcoin represents a potential future for open and accessible financial systems. Block's measured approach, allocating only 3% of resources to Bitcoin projects while still investing in its potential, is a strategy I can get behind.

Block's CEO, Jack Dorsey

The ongoing federal probe regarding Block's compliance practices undoubtedly caused some pre-earnings jitters. While the situation needs to be monitored, analysts predict potential fines or stricter oversight measures as the most likely outcome. Considering Block's financial health and the overall strength of their earnings report, I view this as a short-term hurdle rather than a long-term roadblock.

The pre-earnings drop due to the federal probe presented a buying opportunity that I capitalized on. While it was a calculated risk, the stellar earnings report justified my decision and resulted in a successful options trade.

SQ 20240503 74.0 CALL

Overall, Block's future looks bright. Their core businesses are performing well, Cash App continues to be a growth engine, and their strategic investments like Bitcoin position them for the future. While regulatory scrutiny may linger, I believe Block has the financial strength and leadership to navigate these challenges. I'm excited to see how Block's story unfolds. Until then, I am taking my profits for now.

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Disclaimer: This is not financial advice. Please do your own research before making any investment decisions.