Software - Infrastructure · NYSE
Current Price
$83.46
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Block, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Block, Inc., together with its subsidiaries, creates tools that enables sellers to accept card payments and provides reporting and analytics, and next-day settlement. It provides hardware products, including Magstripe reader, which enables swiped transactions of magnetic stripe cards; Contactless and chip reader that accepts Europay, MasterCard, and Visa (EMV) chip cards and Near Field Communication payments; Square Stand, which enables an iPad to be used as a payment terminal or full point of sale solution; Square Register that combines its hardware, point-of-sale software, and payments technology; Square Terminal, a payments device and receipt printer to replace traditional keypad terminals, which accepts tap, dip, and swipe payments. The company also offers various software products, including Square Point of Sale; Square Appointments; Square for Retail; Square for Restaurants; Square Online and Square Online Checkout; Square Invoices; Square Virtual Terminal; Square Team Management; Square Contracts; Square Loyalty, Marketing, and Gift Cards; and Square Dashboard. In addition, it offers a developer platform, which includes application programming interfaces and software development kits. Further, the company provides Cash App, which enables to send, spend, and store money; and Weebly that offers customers website hosting and domain name registration solutions. It serves in the United States, Canada, Japan, Australia, Ireland, France, Spain, and the United Kingdom. The company was formerly known as Square, Inc. and changed its name to Block, Inc. in December 2021. Block, Inc. was incorporated in 2009 and is based in San Francisco, California.
ROIC (TTM)
4.2%
ROE (TTM)
5.9%
FCF Yield
5.74%
Based on trailing twelve-month data, SQ shows a free cash flow per share of N/A and a ROIC of 4.2%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 5.74% are important context metrics when evaluating SQ's stock valuation relative to peers.
The intrinsic value of SQ depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether SQ is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $83.46. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Block, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Software - Infrastructure industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting SQ's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Block, Inc., this means projecting how much free cash flow the Software - Infrastructure will produce over the next 5-10 years, then discounting those amounts to today's dollars. SQ's ROIC of 4.2% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For SQ, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
