Jack Dorsey’s payments company Square is already up by a double-digit percentage in 2019, and one Wall Street analyst says there’s more runway for gains. According to TD Ameritrade Network , Instinet’s Dan Dolev believes Square’s stock, which is currently hovering at about $74, is worth more like $100 – and that’s a conservative estimate. That places an addition 33 percent upside on a stock that has already seen its value expand by nearly one-third year-to-date. Cash App, which is a peer-to-peer payment system that supports bitcoin, is one of the catalysts.
Dolev points to what he describes as a “closed loop ecosystem” that Square has managed to create that lets it bypass some of the bigger payment networks. It paves the way for Square to steal market share from the likes of banks and payroll companies such as ADP. Dolev likens it to Apple’s ecosystem.
Adding to the “closed loop ecosystem” is Square’s integration of bitcoin, which distances it further from the pack. This is another positive for the stock considering that much of Square’s userbase is considered “under-banked’ in the U.S. It’s not that they don’t have bank accounts at all but they don’t tend to have access to products such as mortgages and the like.
Square is in the process of building its crypto division, Square Crypto. One of the goals of the business is to “accelerate the role of UX design in crypto.”
So far, they’ve brought on Google alum Steve Lee. He was recently asked what Square Crypto was up to, in response to which he said:
“Building the team… Know any great designers interested in having an outsized impact on the design of the future of money (Bitcoin)?”
Instinet’s Dolev hopes that a $100 price target for Square is “just a stepping stone,” pointing to innovation and “products that we don’t even know of today which could potentially provide upside to our price target long-term.”