As Block Launches New Bitcoin Mining Tools, Is XYZ Stock a Buy, Sell, or Hold?

Bitcoin (BTCUSD) has retraced to the $115,000 level. Following BTC’s all-time high above $124,000 last week — fueled by dovish Federal Reserve rate-cut expectations and dollar weakness — the cryptocurrency is facing a technical pullback amid macroeconomic headwinds, including tempered rate-cut optimism and Treasury signals against expanding U.S. crypto reserves.

With supply nearing its limit and institutional inflows rising, Bitcoin’s current consolidation reflects a recalibration, balancing volatility with structural demand. Long-term investors view it as an opportunity, while short-term traders navigate tight ranges, setting the stage for potential re-acceleration as the market matures and corporate crypto strategies deepen.

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At the center of it all is BTC mining, the energy-intensive process where powerful computers solve complex puzzles to verify transactions and release new coins. That’s where the fintech powerhouse Block (XYZ) enters. Known for Square, Cash App, Afterpay, TIDAL, and crypto ventures like Bitkey and Proto, Block recently launched Proto Rig, a modular mining system, and Proto Fleet, open-source management software, designed to cut costs, extend hardware life, and streamline operations.

So, does Block’s mining push signal long-term upside? Or is caution the wiser move?

About Block Stock

Block is Jack Dorsey’s fintech vision turned reality — a company weaving together Square’s merchant tools, Cash App’s banking ease, Afterpay’s buy now pay later (BNPL) service flexibility, TIDAL’s artist empowerment, and crypto ventures like Bitkey and Proto. Its mission is to expand global economic access.

From payments to music to Bitcoin mining, Block is not just building apps. It is creating an interconnected ecosystem where money, commerce, and creativity flow more freely for sellers, consumers, and creators worldwide. Its market capitalization currently stands at $45.7 billion.

Shares of XYZ have been on a roller coaster ride, full of ups and downs. From its 52-week peak of $99.26, the stock has tumbled under the weight of higher interest rates, profitability concerns, stiffening competition, and shaky macroeconomic sentiment. On a year-to-date (YTD) basis, XYZ stock is still down 15%.

Story ContinuesStep back, however, and the picture looks brighter, with shares up 11% over the past year. In the near term, momentum is building as well. Over just the last three months, XYZ stock has surged 26%, hinting at a potential turnaround story in motion.

www.barchart.com Block’s valuation reads like a discount sale in a pricey neighborhood, trading at 1.9 times sales. For investors with the stomach to ride near-term turbulence, the setup whispers “undervalued” for long-haul investors. XYZ is not screaming cheap, but in a frothy fintech landscape, this looks like a risk worth underwriting.

A Closer Look at Block’s Q2 Results

Block's second-quarter earnings report, released on Aug. 7, told a mixed story. Revenue came in at $6.05 billion, down 1.6% year-over-year (YOY) and shy of Wall Street’s target. However, adjusted EPS rose 32% annually to $0.62. Beneath the top-line miss, gross profit surged 14% YOY to $2.5 billion, outpacing analyst estimates and proving Block’s core engines are humming.

Square, Block’s original business, handled $64.25 billion in gross payment volume (GPV), up 10% YOY. That’s no small feat considering its competitors like Toast (TOST) and Fiserv’s (FI) Clover are clawing for market share. Meanwhile, Cash App is maturing into something more than a peer-to-peer wallet Some 8 million users now treat it as their primary bank, generating more profit than average users. Add Borrow, Block’s fast-growing lending arm with $18 billion in annualized originations, and one can start to see the financial ecosystem CEO Jack Dorsey is building.

Never one to shy from tech bets, Dorsey highlighted how internal artificial intelligence (AI) tools like “Goose” are reshaping Block’s DNA. Developers are shipping products like Cash App Pools, a group money-pooling feature that even works with Apple's (AAPL) Apple Pay and Alphabet's (GOOGL) Google Pay. This product velocity is exactly what Block is betting on to keep ahead of rivals.

On the Square side, fresh go-to-market pushes are delivering paybacks in just five to six quarters. New hardware like Square Handheld and AI-powered dashboards are positioning the brand to win across restaurants, retail, and services. Add $58 billion in Bitcoin transactions in Q2, and one has a company positioning itself at every intersection of digital money.

Meanwhile, management lifted full-year gross profit guidance to $10.17 billion, implying 14% YOY growth, and forecast a healthy 20% adjusted operating margin. Q3 guidance looks solid, too, with gross profit growth pegged at 16%.

But it’s not all smooth sailing. Q3 adjusted operating margins are expected to dip temporarily to 18% as Borrow scales, and rising processing costs will squeeze Square’s near-term profitability. Cash App’s user growth has also plateaued, forcing Block to double down on density and acquisition strategies. And expanding lending inevitably raises exposure to credit risk, even with its proprietary scoring model keeping losses under 3%.

Analysts covering Block predict a 54% annual decline in Q3 EPS to $0.26. Looking ahead to fiscal 2025, the bottom line is anticipated to be $1.03 per share, down 69% YOY. Still, that could rebound by 105% annually to $2.12 per share in fiscal 2026.

Block’s Big Bet on Mining Efficiency

As Bitcoin prices climb, efficiency in mining becomes even more critical, and that’s exactly where Block’s new tools come in. The Proto Rig is a modular mining machine that lets operators swap out individual hashboards instead of scrapping entire units. This shift transforms mining rigs from short-lived, three-to-five-year assets into decade-long infrastructure, slashing upgrade costs by 15% to 20% each cycle.

Meanwhile, the Proto Fleet software unifies multiple management functions that miners previously juggled across different programs, streamlining operations, improving uptime, and cutting troubleshooting headaches.

Together, these innovations address mining’s biggest pain points — high costs, downtime, and inefficient hardware. For Block, this is not just a product launch. It is a strategic play to capture market share as institutional adoption drives Bitcoin’s value higher. By making mining more sustainable and profitable, Block is positioning itself to ride the crypto boom while reinforcing its broader mission of expanding access to the digital economy.

What Do Analysts Expect for Block Stock?

Investor sentiment has been highly active around XYZ stock following the company's Q2 results, with analysts offering significant commentary on its performance. Mizuho lifted its price target to $88 from $71 and maintained an “Outperform” rating. The firm sees Square’s point-of-sale volumes surging, especially in the $500,000 cohort, calling Square the “comeback kid of 2025.”

Argus joined the optimism and wasn’t far behind, boosting its target to $84 from $59, crediting strong momentum in restaurants and retail, plus margin expansion, and saying the S&P 500 inclusion only sweetens the deal.

Jefferies took a slightly cooler stance on XYZ stock, trimming its target to $90 from $95 while sticking with a “Buy" rating. The firm likes Square’s U.S. growth trajectory but flagged Cash App’s growing reliance on lending as a concern. Overall, the Street sees Block making a real comeback story with Square, but the jury is still out on whether Cash App’s lending push fuels growth or risk.

XYZ stock has an overall “Moderate Buy” rating. Among the 43 analysts covering shares, 26 recommend a “Strong Buy,” four analysts advise a “Moderate Buy,” eight stay on the sidelines with a “Hold” rating, and five analysts have a “Strong Sell."

Block’s mean price target of $82.39 hints at 12% upside potential from here. The Street-high target of $105 implies that XYZ stock could rally as much as 43%.

www.barchart.com On the date of publication, Sristi Suman Jayaswal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com

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