reported second-quarter sales and profits guidance Wednesday that disappointed analysts, sending shares lower by 7% in after-hours trading.
The Jack Dorsey-led mobile payments company is set to release first-quarter earnings after the bell on Wednesday. Analysts have pared down their expectations for those results by about $0.
"We expect full year revenue guidance could move up, but see EBITDA holding firm recognizing now is the time for Square to invest in consumer/card initiatives; hence we are front loading more expenses for the year," the JPMorgan analysts wrote. "With lots of energy and competition for on-demand banking services like Cash App, we expect investments to drive habitual usage to stay elevated."In a mid-April note to investors, SunTrust analysts led by Andrew Jeffrey said that while the Square is the"most dynamic and disruptive name we follow," its high valuation has everything priced in.More broadly, Wall Street analysts are nearly split between bullish and neutral.
Square shares have jumped 32% this year, but remain 26% below their all-time high of $101.15 set in October.