Square Stock Analysis, Valuation (NYSE:SQ)

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$28.75 $0.35 (1.23%) SQ stock closing price Sep 22, 2017 (Closing)
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Square
Updated on : Sep 22, 2017
previous close
SQ 28.8 (0%)
NASDAQ 6426.9 (0%)
Closing Price On: Sep 22, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Internet Software
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2017-Q2
$million
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
-3.8%
Sector Average:
5.9%
5 Quarter Net Profit
Net Margins
2017-Q2
%
LTM Margin
Debt/Equity Ratio
Debt:
350M
Debt/Equity Ratio:
 0.5
Compared to the industry
Cash Flow
Operating cash flow:
$46.6M
Net Income:
-$16M
PROS      CONS
Recent Growth
Operating Margins
Net Margins
High Debt Burden
ROIC
ROE
PE Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
PE: N/A
SQ PS :
5.7
Industry PS :
2.8
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-43.5%
Return on Equity:
-13.6%
Free Cash Flow Margin:
7.1%
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Square Stock Analysis

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View Square stock analysis video. This is our analyst opinion covering the buy and sell arguments for SQ stock.

Square Inc Stock Rating 2/5

Our Square stock opinion is based on fundamentals of the company. This Square stock analysis is based on latest 2017 Q2 earnings. The stock price analysis takes into account the company's valuation metrics.

Should you buy SQ stock?

  • Square's revenue growth came in at 25.8% in 2017 Q2.

Should you sell SQ stock?

  • Over the last twelve months, Square posted an average operating loss margin of -3.8%.
  • Square registered an average TTM Net loss of -4.1%.
  • With a debt/equity ratio of  0.5, Square is highly leveraged in comparison to Computer and Technology peers.
  • The lack of profits renders the PE ratio useless for SQ stock.
  • SQ stock is trading at a PS multiple of 5.7, which is a negative when compared to the Internet Software industry average multiple of 2.8.
  • The company has a negative Return on Invested Capital of -43.5%, which is a red flag.
  • Square has a negative return on equity of -13.6%. This indicates that the firm is inefficient at generating profits.

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