Block, Inc. (XYZ) stock analysis

P/E above its 5-year median

Block's P/E of 151.0 is above its own 5-year median of 53.4.

P/E above the industry

Block's P/E of 151.0 is above the Computer Programming, Data Processing, and Other Computer Related Services median of 27.3.

EV/EBITDA below its 5-year median

Block's EV/EBITDA of 28.6 is below its 5-year median of 28.7.

P/B below the industry

Block's price-to-book of 2.30 is below the Computer Programming, Data Processing, and Other Computer Related Services median of 3.05.

Trading above fair value

The share price of $84.58 is above our fair value estimate of $51.20.

Margin of safety under 20%

The price is 65.2% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 11.3% a year over the last three fiscal years.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings growth not accelerating

Net income grew -87.9% over the last twelve months, against a 5-year average of 43.7% a year.

Growing slower than the industry

Revenue grew 5.1% over the last twelve months; the Computer Programming, Data Processing, and Other Computer Related Services median is 9.6%.

Guidance raised

Block raised its 2026 Adjusted Operating Income % Margin outlook on Aug 5, 2026.

Gross margin improving

Gross margin was 46.4% over the last twelve months, against 39.4% a year earlier.

Return on equity under 15%

Return on equity was 1.6% over the last twelve months and averaged 4.2% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 3.7%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Block's return on equity of 1.6% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -1.1%.

Earnings grew over 5 years

Net income grew 43.7% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 1.4% over the last twelve months, against a 5-year average of 3.1%.

Net margin above the industry

Block's net margin of 1.4% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -4.7%.

No debt

Block has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets cover short-term debts

Current assets are 2.21 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 3.03; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Block has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.