Stocks quotes in this article:
SQ,
PYPL,
MC,
V,
WIX
Square (SQ) shares are continuing a multi-day push after announcing it would buy Weebly for $365M in stock and cash. This shouldn't come as a huge surprise. The company has been offering a platform for small businesses to accept online payment for some time. The move to acquire Weebly makes sense, a vertical integration of sorts. A move for SquareSpace or Wix (WIX) may have expanded the power of the purchase, but the cost was likely prohibiting a deal.
Strong earnings from names like Visa (V) , Mastercard (MC) , and PayPal (PYPL) should bode well fundamentally for Square. This has been a volatile earnings season thus far, so little can be anticipated in how Square's shares will react. My focus is on the longer term. I'm a buyer on weakness but hesitant to add over $55. That's been a spot of selling.
Much has been made of Square's involvement in cryptocurrency. Look, it's a bonus if anything comes from it. Plain and simple. It's not the company's focus and the core fundamental story stands on its own. Crypto may add up to $50 million in revenues over next 12 to 24 months, but it's not a factor in my bullish view. I'm looking for shares to push into the $55-$60 range this year. On the downside, I see low $40s as support and a very attractive area to get aggressively long.
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I'd lean towards playing a banking ETF here since the patterns are similar between C and one like XLF.
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