Square's earnings guidance misses big, shares sink (SQ)

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Square shares fell in after-hours trading Wednesday after the company reported fourth-quarter results.
The Jack Dorsey-led mobile-payments firm reported in line earnings and revenue that topped forecasts.
The company also issued first-quarter earnings guidance that fell short of estimates, sending the stock down nearly 6%.
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Shares of Square, the mobile-payments company, fell nearly 6% in after-hours trading Wednesday after the company issued first-quarter profit guidance that fell short of expectations.

Square said it expects to report first-quarter adjusted earnings per share between $0.06 and $0.08 — a range below the $0.12 that analysts expected.

Here's what Square reported, compared with what analysts surveyed by Bloomberg were expecting.

Adjusted earnings per share (EPS): $0.14 versus $0.14 expected.
Revenue: $464 million versus $454.6 million expected.

Wednesday's report marked the first without the longtime CFO, Sarah Friar. Her departure was first announced last October, a development that slammed the stock. Last month, the company named former Activision Blizzard executive Amrita Ahuja as her replacement.

Ahead of the results, James Friedman, an analyst at Susquehanna, told clients Square continues to innovate in the financial-technology space, and reiterated his price target of $77 — about 2% below where shares were trading Wednesday.

Previously, Friedman lowered his rating on Square's stock from "positive" to "neutral" after the company offered weaker-than-expected profit guidance. Still, Friedman is positive for the long-term.

More broadly, Wall Street's sentiment on the Jack Dorsey-led company is split between neutral and optimistic outlooks.

Of the analysts surveyed by Bloomberg, 17 say "buy," 15 say "hold," and just four say "sell."

Square shares surged 190% between the start of 2018 and its all-time high of $101.14 in September. Currently, they're down 23% from their September peak.

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