Block stock slides to 52-week low as investors focus on value, competition heats up
martin-dm/E+ via Getty Images


Block (SQ
-4.7%), previously known as Square, touched its 52-week low of $151.02 in Tuesday trading on a day when investors appear to be focusing more on financial stocks than tech names.
Note that among S&P 500 industry sectors energy (+3.4%) and financials (+2.7%) are the best performing sectors. Information technology is the second-worst performing sector, at -1.1%, after health care, -1.2%.

Part of the slump could be investors shifting away from growth stocks. Blackstone's Byron Wien and Joe Zidle recently predicted value stocks will outperform growth ones in 2022, continued volatility, and a stock market correction.
Fintech stocks have been hurting in recent months. Note that PayPal (NASDAQ:PYPL)
notched its worst annual decline last year after the stock declined when report of a deal with Pinterest emerged, then the deal fizzled, then the company issued disappointing earnings. This also comes at a time when fintech firms are coming under increased scrutiny by regulatory agencies.
For more industry specific dynamics, fintechs are coming under more pressure as competition in the sector increases. For example, Affirm Holdings (NASDAQ:AFRM), a provider of Buy Now, Pay Later financing, has gained 94% in the past year. Block agreed last year to buy Afterpay (OTCPK:AFTPY), and PayPal (PYPL), which has also developed its own BNPL product, is acquiring Japan-based Paidy to expand in that space. See chart comparing SQ, PYPL, and AFFRM total returns here.
The Afterpay (OTCPK:AFTPY) stockholder vote on its sale to Block (NYSE:SQ), originally scheduled for Dec. 6, was delayed as they still haven't received a non-opposition opinion from Spain's central bank.
SA's Quant rating is Bearish, SA Authors' average rating is Neutral, while the average Wall Street rating is Bullish.
SA contributor Mott Capital Management, in looking at options trading, says Block (SQ) may have further to fall. By contrast, Anthony Cataldo sees the pullback as an attractive entry point.