Payment services firms hardly see sudden optimism. But bucking this trend, rating firm Nomura Instine Tuesday raised its price target on a financial services stock by about 50%, besides likening it to the prestigious FANG stocks.
San Francisco-based Square (SQ) has received a Wall Street high price target of $125 from Nomura Instinet, following which the stock soared 8.4% to $93.30 at 1:30 PM ET. The prior price target was $86.
“Similar to FANG stocks that have disrupted traditional markets with massive global TAMs, SQ’s fully cohesive solutions and rapid rate of innovation suggest that it is en route to disrupt the global payments ecosystem,” Nomura analyst Dan Dolev wrote in an investors’ note, reported Bloomberg.
With options traders predicting further upside, the chances are more rating firms will come forward in the coming days with revisions on Square.
The stock has gained 158% so far this year and a staggering 240% in the trailing 52 weeks, despite the fact that most rating agencies still have a “sell” or “hold” rating on it.
However, analysts may be correcting their mistake one by one. Evercore ISI and Stifel had last week raised their respective price targets on Square to $101 and $100.
With the latest stock rally, price targets set by most other analysts are at a discount to the current trading price. With options traders predicting further upside, the chances are more rating firms will come forward in the coming days with revisions on Square.
So will FANG become FANGS? It’s squarely possible.
Square’s loss narrowed, weak Q3 profit outlook remains a concern