Is SQ Stock Deep Value? While Michael Burry bought SQ in the 4Q 2023, and it wouldn't surprise me if SQ stock is up significantly in the future, I'd rather own a business where I can have greater faith in management's capital allocation abilities. In this video I also mention that they bought Afterpay for "cash & stock" when it was actually entirely in stock. That was a mistake, sorry! While the usage of "overpriced" SQ stock to pay for an overpriced acquisition (Afterpay) does make the cost a lot more palatable, I would rather that they have just issued stock for cash, and then bought Afterpay when it was actually reasonably priced. If you have any opinion on SQ stock, or use the Square or Cash Apps, would love to hear it in the comments below. Do you think they're UNRIVALED and deserve to win in the years ahead?
In an interview, Jack Dorsey said he was proud the Afterpay acquisition was not his idea, but rather the idea of Square CEO, Alyssa Henry, and Cash App CEO, Brian Grassadonia. (This was before everyone thought they overpaid for Afterpay). He trusted his CEOs too much to lead the company. I feel if Jack was CEO of square he wouldn’t have made that decision. Jack has also said he never wanted to be a leader or run a company. That’s probably why he tends to assign CEO roles to other people. But now they fired the Square CEO Alyssa Henry due to poor performance and Jack is back as CEO. I believe this is a turning point for SQ. I believe Jack is a product genius. Since Jack is focused and back at leading the company then I am all in!
I've profited from researching the names he's bought historically, and despite his bearish tendencies, I think he's one of the best analysts out there (not necessarily portfolio managers). That said, he has very high turnover.
@@unrivaled whatever works. I'm curious though why you think he's one of the best analysts out there as he doesn't really provide any accompanying analysis with any of his positions, which you note are often fleeting.
LOL daniel, i 100% agree with you about their lack of cost discipline. Their gross profit has exploded (amazing) but their operating costs have gone up just as much.
Because its focus on revenue growth is about to transition into continuous and growing net profit over this year and next. The gradual disappearance in physical Cash over the next 20 years has also already started in cities which is an underlining catalyst. Interest rates coming down over the next few years will also drive the share price upwards which is well needed after such high inflation caused by the covid period, People need to gain more spending power. Cash app Square & Afterpay/clearpay are great assets which make the company very attractive Tidal, not so much. They should sell it off.
Can I ask honestly why everyone thinks afterpay was a poor acquisition? What competition does the USA and Australia have when it comes to spreading purchases over 3-4 months? I'm in the uk where clearpay (afterpay) competes with karna which is privately owned but I think soon to be listed publicly. Does it compete in the USA and aus?
In the book, “ hatching twitter “ it states multiple times that jack dorseys true passion was to get into the fashion industry, it wouldn’t surprise me if he buys a clothing company next.
Everything was accurate. Jack is very impulsive. Remembering the day he blurted out that SQ was going to offer Bitcoin very early on. That drove the stock way up in speculation. It worked for a while. Now Robinhood owns 6x the amount of BTC vs SQ. SQ is getting eclipsed by robinhood, coinbase, MicroStrategy, Galaxy Digital. Don't get me wrong, I loathe crypto but if BTC ends up being this massive success that Dorsey claims it will, SQ did not keep pace with and isn't in a leadership position. Yes he backs lightning network and has the ecosystem to process BTC purchases but SQ only has $500m worth of BTC.
The good old times of trading monkey pictures in 2021. I don't understand these payment processors what makes one better than the other. I didn't check Block's cash-flow statement so far, but I would bet to find huge stock-based compensation
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Is SQ Stock Deep Value? While Michael Burry bought SQ in the 4Q 2023, and it wouldn't surprise me if SQ stock is up significantly in the future, I'd rather own a business where I can have greater faith in management's capital allocation abilities. In this video I also mention that they bought Afterpay for "cash & stock" when it was actually entirely in stock. That was a mistake, sorry! While the usage of "overpriced" SQ stock to pay for an overpriced acquisition (Afterpay) does make the cost a lot more palatable, I would rather that they have just issued stock for cash, and then bought Afterpay when it was actually reasonably priced. If you have any opinion on SQ stock, or use the Square or Cash Apps, would love to hear it in the comments below. Do you think they're UNRIVALED and deserve to win in the years ahead?
In an interview, Jack Dorsey said he was proud the Afterpay acquisition was not his idea, but rather the idea of Square CEO, Alyssa Henry, and Cash App CEO, Brian Grassadonia. (This was before everyone thought they overpaid for Afterpay). He trusted his CEOs too much to lead the company. I feel if Jack was CEO of square he wouldn’t have made that decision. Jack has also said he never wanted to be a leader or run a company. That’s probably why he tends to assign CEO roles to other people. But now they fired the Square CEO Alyssa Henry due to poor performance and Jack is back as CEO. I believe this is a turning point for SQ. I believe Jack is a product genius. Since Jack is focused and back at leading the company then I am all in!
Never seen you so frustrated with a company. 😂 All spot on though. Thanks Daniel!
Your admiration for Burry is unrivaled.
I've profited from researching the names he's bought historically, and despite his bearish tendencies, I think he's one of the best analysts out there (not necessarily portfolio managers). That said, he has very high turnover.
@@unrivaled whatever works. I'm curious though why you think he's one of the best analysts out there as he doesn't really provide any accompanying analysis with any of his positions, which you note are often fleeting.
I like your style and could listen for hours! thanks for the great content you provide!
Thanks again, really enjoy listening to these
Glad it's helpful for you! Thank you for the feedback.
afterpay was an all stock acquisition though. Still don’t get it why they spent billions on buying Tidal … so jack can sit next to J&B at Super Bowl ?
LOL daniel, i 100% agree with you about their lack of cost discipline.
Their gross profit has exploded (amazing) but their operating costs have gone up just as much.
I recently bought the ridiculous dip at the end of last year. I now hold a large amount under $50.
Love your videos- you aren't afraid to say it like you see it !!
I think this company will in some way become one of the top 7 in the USA in the next 10 years.
Why?
Because its focus on revenue growth is about to transition into continuous and growing net profit over this year and next. The gradual disappearance in physical Cash over the next 20 years has also already started in cities which is an underlining catalyst. Interest rates coming down over the next few years will also drive the share price upwards which is well needed after such high inflation caused by the covid period, People need to gain more spending power.
Cash app
Square &
Afterpay/clearpay are great assets which make the company very attractive
Tidal, not so much. They should sell it off.
afterpay must be one of the most expensive acquisitions ever. Aussie investors were happy!
Would also book a multiyear subscription. :) happy to be part of the unrival nation.
Thank you Peter! Grateful to be on this journey with you.
Good video Daniel and i think you are right to be so skeptical. This company adjusts everything they make it impossible to just draw a straight line
The "rule of 29" part got me. :D :D :D
I've been around the block and this is great analysis!
Thank you!
Multi year subscription would be a great option to offer out in the future 😊
Can I ask honestly why everyone thinks afterpay was a poor acquisition? What competition does the USA and Australia have when it comes to spreading purchases over 3-4 months? I'm in the uk where clearpay (afterpay) competes with karna which is privately owned but I think soon to be listed publicly. Does it compete in the USA and aus?
In the book, “ hatching twitter “ it states multiple times that jack dorseys true passion was to get into the fashion industry, it wouldn’t surprise me if he buys a clothing company next.
That is great feedback. Thank you.
Good company, bad stock. Management does not care about shareholders
Everything was accurate. Jack is very impulsive. Remembering the day he blurted out that SQ was going to offer Bitcoin very early on. That drove the stock way up in speculation. It worked for a while. Now Robinhood owns 6x the amount of BTC vs SQ. SQ is getting eclipsed by robinhood, coinbase, MicroStrategy, Galaxy Digital. Don't get me wrong, I loathe crypto but if BTC ends up being this massive success that Dorsey claims it will, SQ did not keep pace with and isn't in a leadership position. Yes he backs lightning network and has the ecosystem to process BTC purchases but SQ only has $500m worth of BTC.
LMAO I would rename this episode as " I know more than Michael Burry " 😂🤣😆
Jack Dorsey is an extremely bad capital allocator, all his buys are more personally driven than what is actually good for the company.
Jack D purchased Tidal bcuz he is friend of Jay Z. If he admits it’s a mistake, it basically saying their friendship ends.😅
Jack Dorsey is a very, very weird individual. Integrity highly questionable.
👍
your missing out on all the growth stocks, they will always trade expensive
The good old times of trading monkey pictures in 2021. I don't understand these payment processors what makes one better than the other. I didn't check Block's cash-flow statement so far, but I would bet to find huge stock-based compensation