I’ve been wanting to add to SQ, but it went up so fast last month I didn’t get a chance to, I last added at $37. I think it went up so fast it got ahead of itself and all the momentum investors jumped in. Now all the momentum investors are jumping out, or jumping to the short side.
Mark Parker made the downgrade based on valuation, he has a $30 price target based on 20x his 2020 adjusted ebitda target of $610 M.
It is very hard to predict what the ebitda will be 3 years out with everything that’s happening at SQ. Also, the growth rate is accelerating.
Momentum is a powerful force.
Jimbo