HSBC Raises Block Price Target to $77, Lifts 2026 EPS Forecast 16%
HSBC raised Block’s 2026 operating earnings estimate by 20%, lifted EPS by 16%, and increased its price target to $77 from $70, implying 20% upside. The bank said Block’s near-50% workforce cut will boost margins, with 60% of 2026 earnings in H2 and 2027 forecasts 6%–9% above consensus.
1. HSBC Upgrade and Price Target
HSBC upgraded Block to Buy and raised its price target to $77 from $70, citing a material increase in earnings power and an attractive risk-reward profile with roughly 20% upside.
2. Earnings Estimate Revisions
The bank increased its 2026 adjusted operating earnings estimate by about 20% and lifted the adjusted EPS assumption by 16%, aligning with Block’s guidance and introducing new 2028 estimates.
3. Workforce Reduction and Margin Impact
Block plans to cut almost half its workforce, a move described as strategic rather than defensive, which HSBC believes will meaningfully increase operating margins supported by strong gross profit growth.
4. Earnings Timing and 2027 Outlook
HSBC notes that about 60% of 2026 adjusted operating earnings will be generated in H2, and suggests 2027 consensus estimates are too low, with its own forecasts 6%–9% above consensus.