Jack Dorsey’s Block Draws Analyst Downgrade on Bitcoin Sentiment

Mizuho cuts its rating on the stock to neutral from buy, citing slowing growth for Cash App and management's attention on BTC.

AccessTimeIconSep 22, 2022 at 1:17 p.m. UTC
Updated May 11, 2023 at 6:49 p.m. UTC

Shares of Block (SQ), the payments company run by Twitter (TWTR) co-founder and crypto proponent Jack Dorsey, were downgraded to neutral from buy by investment bank Mizuho, which cited "user fatigue" and management's fixation with bitcoin (BTC).

Cash App’s penetration among 18-45 year old Americans is likely to rise by just 500 basis points in 2022, which lags the 800-900 basis points seen annually over the previous three years, analyst Dan Dolev wrote in a note to clients on Tuesday.

In addition, Dolev noted that bitcoin accounted for only about 5% of gross profit in the first half of 2022, but occupies a far higher percentage of management's focus. Block’s fixation with bitcoin hurts the stock performance and takes away attention on the company's larger platforms, Dolev wrote.

Dolev slashed his price target to $57 from $125. Earlier this month, Evercore ISI cut its rating on Block to underperform from outperform, and in July, Macquarie downgraded the stock.

Block's shares were down 1.8% in premarket action and are down 64% so far this year. They closed at $59.45 on Wednesday.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Author placeholder image

Michael Bellusci is CoinDesk's crypto reporter focused on public companies and digital asset firms.