Key Moments
- In May 2025, Investing.com’s Fair Value models flagged Block, Inc. (NYSE: SQ) as undervalued, with a $68.97 estimate versus a $46.53 market price.
- By early January 2026, Block shares were trading near $70, delivering a 63.2% gain for investors who followed the signal.
- Over the period, EBITDA rose 18% to $1.67 billion and EPS climbed 20% to $5.10, alongside a $5 billion buyback plan.
Repricing After the May 2025 Undervaluation Call
In May 2025, Investing.com’s proprietary Fair Value framework identified Block, Inc. (NYSE: SQ) as trading well below its intrinsic value. As a result, the stock stood out as an attractive opportunity. Eight months later, investors who acted on the signal captured a 63% gain. This outcome highlights the potential value of systematic valuation tools.
Importantly, the Fair Value analysis aims to identify better entry and exit points by estimating intrinsic value through several valuation methods. By focusing on fundamentals and filtering out short-term market noise, the framework supports more disciplined investment decisions. Meanwhile, investors seeking similar ideas can track Investing.com’s regularly updated list of stocks trading below estimated intrinsic value.
Block’s Business Profile and Pre-Signal Volatility
Block, Inc., formerly known as Square, operates in the financial technology space within the Industrials sector. The company offers payment processing, point-of-sale tools, and digital banking services through its Square and Cash App platforms.
At the time of the May 2025 signal, Block generated $23.9 billion in revenue and $1.4 billion in EBITDA. However, the stock had experienced sharp volatility. Shares fell 28% in February 2025 and dropped another 16.8% in March. A recovery only began to form in April.
From Fair Value Signal to a 63% Gain
When the Fair Value call was issued, Block traded at $46.53. In contrast, InvestingPro’s Fair Value estimate stood at $68.97, implying 48.2% upside. In addition, a financial health score of 2.6 supported the bullish outlook.
Subsequently, performance exceeded expectations. By October 2025, the stock climbed to $75.92, moving above the Fair Value target. As of early January 2026, shares trade near $70. This level represents a 63.2% return for investors who entered at the original signal.
| Metric / Event | At Fair Value Signal (May 2025) | Later Outcome |
|---|---|---|
| Share price | $46.53 | Around $70 in January 2026 |
| Fair Value estimate | $68.97 | Reached $75.92 by October 2025 |
| Implied upside | 48.2% | Actual return of 63.2% |
| EBITDA | $1.4 billion | $1.67 billion (+18%) |
| EPS | Not disclosed | $5.10 (+20%) |
Fundamental Drivers and Corporate Milestones
Several developments reinforced the bullish case after the Fair Value call. Notably, Block joined the S&P 500 index. In addition, Moody’s and Fitch upgraded the company’s credit ratings. Block also announced a $5 billion share repurchase program and projected 30% annual growth in adjusted income.
At the same time, operating performance improved. Compared with conditions at the signal date, EBITDA increased 18% to $1.67 billion. Earnings per share also advanced 20% to $5.10.
How InvestingPro’s Fair Value Model Works
InvestingPro’s Fair Value system combines several valuation methods to estimate intrinsic value. These include discounted cash flow models, peer comparisons, dividend discount models, and analyst consensus targets.
By blending these inputs, the model helps investors separate short-term price swings from longer-term shifts in underlying value. As a result, it can highlight stocks trading well above or below their fundamental profiles.
Broader Takeaways for Investors
Block’s performance after the May 2025 signal shows how data-driven analysis can surface opportunities before broader market recognition. Beyond Fair Value estimates, InvestingPro also offers real-time alerts, ProTips, financial health scores, and customizable screeners.
To explore similar opportunities and see which stocks InvestingPro currently views as undervalued, investors can learn more about InvestingPro and enhance their research process.
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