Square Stock Gaps Higher on Instinet Bull Note

SQ stock has nearly tripled over the past 12 months

by Karee Venema

    Published on May 16, 2018 at 3:05 PM

    Square Inc (NYSE:SQ) is trading higher today, after an analyst at Instinet said Square Cash app growth is outpacing downloads for Paypal's (PYPL) Venmo. The analyst in coverage reiterated his "buy" rating and $65 price target -- a 15% premium to SQ stock's current perch at $56.51, up 3.4% on the day.

    Today's positive price action is just more of the same for Square stock, which has nearly tripled over the past 12 months. More recently, the shares have been bouncing higher atop their 80-day moving average since late December, with this trendline working as a springboard for SQ following a recent pullback from its March 21 record high of $58.46.

    sq stock daily chart may 16

    But unlike fellow bitcoin name Advanced Micro Devices (AMD) -- which, alongside Square, is a member of the newly launched blockchain exchange-traded fund REX BKCM ETF -- there's plenty of skepticism priced into shares of the payment processor. For starters, the stock's 10-day put/call volume ratio of 0.55 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 91st annual percentile, indicating puts have been bought to open relative to calls at a quicker-than-usual clip.

    And although short interest declined 6.4% in the most recent reporting period, there are still 33.63 million SQ shares dedicated to these pessimistic positions -- representing a healthy 12.7% of the stock's available float. A continued rise by Square could shake some of the weaker bearish hands loose, creating tailwinds for the shares.

    Plus, there's ample room for analysts to upwardly revise their ratings. Of the 29 brokerages covering Square stock, 12 maintain a "hold" or "strong sell" rating, while the average 12-month price target of $50.55 stands at a discount to the equity's current perch.

    Semiconductor Sell-Off Could be Good News for This Chip Stock
    Pullbacks to the 320-day moving average have marked buying opportunities
    Time To Bet On a Netflix Stock Rally
    The shares are trading near a trendline that has historically bullish implications
    Molina Healthcare Stock Could Make a Big Move Higher
    A "buy" signal is flashing for MOH again
    From Schaeffer's Pro Traders
    Weekly Options Secrets Revealed

    Direct from our Schaeffer's traders, your FREE guide to winning with weekly options!


    NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

    MORE | MARKETstories

    The Tax Plan is Never Going to Grow the Economy… Unless This Is Fixed First
    Are you ready for a potential economic reset?
    Amedisys Carves Out New Highs on Oppenheimer's Latest Hike
    AMED nabbed another new record high earlier today
    Walmart Earnings, Tesla Share Spotlight With Turkey, Trade
    The retailer's earnings have the Dow headed toward a weekly win
    The Tax Plan is Never Going to Grow the Economy… Unless This Is Fixed First
    Are you ready for a potential economic reset?