It's been a fairly lacklustre Friday session for the S&P/ASX 200 Index (ASX: XJO) and most ASX 200 shares today. At the time of writing, the index has risen by a mild 0.09%, and is sitting at just over 8,350 points. But it's a very different story when it comes to Block Inc (ASX: XYZ) shares.
This ASX 200 tech stock is on fire today; there is no other way to put it. Block closed at $85.80 a share yesterday afternoon. However, those same shares opened at a flat $90 this morning before rising as high as $91.39 soon after. At the time of writing, Block stock has cooled off slightly, but it is still up an impressive 5.93% at $90.89.
So why has the Block share price catapulted so much higher than the broader market this Friday?
Image source: Getty Images
Why have Block shares jumped up 6% today?
Well, unfortunately, we can't know for sure. There's been no fresh news out of Block itself for a while now.
However, we can speculate. Firstly, it's worth noting that Block's ASX shares follow the company's primary listing in the United States. In overnight trading, Block's New York-listed shares galloped 5.25% higher to close at US$58.35.
As such, it's not surprising that the ASX-listed iteration of this company's stock has followed suit today.
Secondly, Block's gains today are just the latest in an upward trajectory that has been ongoing for a few weeks now. Investors might recall that, at the start of this month, Block shares crashed by a horrid 26.7%.
As we covered at the time, this was a result of a disappointing quarterly update.
Block reported revenue of US$5.77 billion for the quarter ending 31 March, down 3% from the prior corresponding quarter. Although the company also revealed that its gross profits were up 9% to US$2.29 billion, Block's management cautioned investors that it is now expecting lower profits going forward, thanks to a "more dynamic macro environment".
Investors were evidently not impressed at the time.
However, it seems that they may have panicked too soon. Since that 26.7% fall on 2 May, the company had rebounded by 27% as of yesterday afternoon. Today's gain takes that rebound to 34.1%. So it seems investors have become more forgiving as May has worn on.
Perhaps they are looking to brokers for encouragement. As my Fool colleague noted today, broker Morgan Staley has recently given Block's US shares a price target of US$67. That would see the company lift by a further 14.8% if realised.
