Square Inc. specializes in mobile payments and electronic transactions using the Square chip reader. The company is led by co-founder Jack Dorsey, who also co-founded and currently runs Twitter. Square went public in 2015 and has been striving to live up to its initial hype ever since. Here’s a breakdown of how the company is faring now.
|What Square Is Worth|
|Square Share Price, 52-Week Range||$167.11 – $289.23|
|2020 Revenue||$9.4982 Billion|
|2020 Profit||$213.11 Million|
|GOBankingRates’ Evaluation of
Square Net Worth
|All information on 52-week range accurate as of Nov. 5, 2021.|
|CEO Jack Dorsey Net Worth||$13.8 Billion|
Square Market Cap: $116.495B
Market capitalization is determined by the total dollar value of a company’s outstanding shares, which helps investors determine the relative size of a company. Square’s market cap range reflects how the market as a whole values the company. Company growth also affects the market cap, as Square’s share price fluctuations directly affect its size as viewed by investors.
Square Net Worth: $6.517B
Market caps offer one view of what the market values a company at, but because of unpredictable market forces, that value is also volatile, even if it can present a relatively accurate price range. In an effort to bypass market volatility, the GOBankingRates Evaluation calculates a company’s net worth based on recent annual reports of income and profit while also taking into consideration the company’s assets and liabilities.
Based on Square’s revenue and profits from the last three years, it is worth more than $6.517 billion.
Square Jumps on the Bitcoin Bandwagon
Square’s IPO proved less than satisfying, opening with a valuation lower than expected. According to The Wall Street Journal, its shares were initially priced at $9, below the original projection of $11 to $13 and much less than the $15.46 figure Square listed for private investors while fundraising. Despite incurring net losses from 2015 to 2018, the company was poised to generate profits for the first time in 2019, and it more than quadrupled its revenue from 2017 to 2020.
Square’s other area of concentration currently is to focus on the cryptocurrency Bitcoin. In June 2018, New York’s Department of Financial Services approved Square’s virtual currency license, allowing New Yorkers using Square’s Cash App to trade in the cryptocurrency, CNBC reported. While some questioned how successful Square might be in that venture, its app generated $1.8 billion in Bitcoin revenue in the third quarter, up 11% year over year, according to the company’s shareholder letter. However, gross profit was just $42 million, or about 2% of Bitcoin revenue — compared to 200% appreciation in Q2, according to ZDNet.
Good To Know
Square reported gross profits of $1.13 billion in the third quarter, up 43% compared to the same quarter last year but missing estimates by $20 million. Total net revenue was $3.84 billion, up 27% from the same quarter last year ($2.03 billion, up 45%, excluding Bitcoin). Analysts had predicted net revenue of $4.39 billion, IBD reported. Earnings per share sat at 37 cents. Although that was up from 34 cents in Q2, according to Investor’s Business Daily, it fell short of analysts’ estimates of 38 cents.
The stock dipped when the earnings were released, but it rebounded slightly later in the day and closed at $247.46. Shares are up 44.47% since last year and 13.7% since the beginning of 2021.
Square’s Founders and Investors
Square CEO Jack Dorsey conceived of Square with co-founder Jim McKelvey as a versatile way of accepting payments. McKelvey, who has experience as a glass-blowing artist, became frustrated when he couldn’t sell a piece to a customer with a credit card, according to Inc. He approached Dorsey about this problem, and their collaboration resulted in Square Inc.
Square counts investment giants Morgan Stanley, Vanguard Group and Blackrock Inc. among its institutional investors, with Morgan Stanley leading the pack with 7.28% of the shares.
Sean Dennison contributed to the reporting for this article.
Methodology: The GOBankingRates Evaluation assesses a company’s net worth based on the company’s total assets, total liabilities, and revenue and net income from the last three years. Base value is established by subtracting total liabilities from total assets from the company’s last full fiscal year. Income value is established by taking the average of the revenue from the last three full fiscal years, 10 times the average of the net profits from the last three full fiscal years, and then calculating the average of those two figures. The final GOBankingRates Evaluation number is the sum of the base value and the income value.
Data is accurate as of Nov. 4, 2021, and subject to change.